Cristopher Kennedy

Cristopher Kennedy with William Blair inquired about the key performance indicators (KPIs) Payoneer shareholders should track to monitor the progress of the company's strategic shift towards an upmarket customer segment, especially given upcoming changes in segment disclosures. He also asked about the long-term potential for expanding core profitability, excluding interest income.

Answer

CEO John Caplan highlighted that customers generating over $50,000 in Q4 2025 represented 42% of revenue, a 10 percentage point increase from Q1 2022, indicating a strong existing upmarket business. He advised tracking ARPU growth, cross-selling product adoption, and volume per customer growth. CFO Bea Ordonez emphasized the significant leverage unlock, with the 2026 core Adjusted EBITDA ex-interest midpoint at $90 million, more than double the prior year. She attributed this to top-line growth, improved transaction margins, portfolio health, and the AI-first strategy, expressing confidence in continued leverage expansion beyond 2026.

Cristopher Kennedy of William Blair inquired about the long-term EBITDA margin profile excluding interest income and asked for more details on the benefits of using blockchain for treasury management.

Answer

CFO Bea Ordonez affirmed that core adjusted EBITDA (ex-interest income) is on track to more than triple year-over-year, demonstrating improved core profitability even with ongoing investments. She explained that using blockchain for treasury, via a partnership with Citi, provides 24/7 fund movement, automation, and programmability, which enhances internal liquidity and risk management and ultimately benefits customers.

Cristopher Kennedy from William Blair asked about the levers Payoneer can pull to maintain its recent momentum in adjusted EBITDA excluding float income, especially in a potentially more difficult macroeconomic environment. He also inquired about the company's strategy and the scale of the opportunity in workforce management.

Answer

CFO Bea Ordonez affirmed that Payoneer will remain disciplined operators with levers over discretionary and variable spending to optimize margins as the environment evolves. CEO John Caplan highlighted the progress in workforce management, noting the rebranding from Squad, strong customer demand for global teams, and achieving a milestone of over $1 million in new incremental ARR. He stated it validates Payoneer's financial stack strategy.

Cristopher Kennedy questioned the long-term margin potential for core EBITDA (excluding interest income) and asked for more detail on the cohort of ICPs generating over $250,000 in monthly volume.

Answer

CFO Bea Ordonez highlighted the significant leverage in the core business, moving from a loss in 2023 to a guided $40M+ profit in 2025. She affirmed the 25% total adjusted EBITDA margin as a solid long-term target. CEO John Caplan described the largest ICPs as highly satisfied customers with strong logo and revenue retention, noting the go-to-market team is effectively acquiring more of these high-value clients globally.

Cristopher Kennedy asked for more details on the strategic opportunity with the Skuad acquisition heading into 2025 and for an update on the current M&A environment.

Answer

CEO John Caplan stated that the Skuad integration is on track, with cross-sell activities beginning, positioning Payoneer as a comprehensive financial solution for SMBs. He also confirmed that the company is actively pursuing tuck-in M&A to extend product capabilities, grow ARPU, and expand its footprint, with plans to execute on this strategy in 2025 and beyond.

Cristopher Kennedy asked CFO Cassandra Hudson about her key priorities and focus areas for the business in her new role. He also inquired about the free cash flow conversion target as part of the 2030 framework.

Answer

CFO Cassandra Hudson outlined her priorities: supporting new customer growth, activating customers, launching DSSP, and accelerating product development for treasury management and loan origination, alongside AI initiatives. She stated a target of 90% free cash flow conversion from Adjusted EBITDA by 2030.

Cristopher Kennedy asked CFO Cassandra Hudson about her key priorities in her new role and inquired about the company's free cash flow conversion targets for 2030.

Answer

CFO Cassandra Hudson outlined her priorities as supporting growth (new customer acquisition, DSSP activation), accelerating product delivery (treasury management, loan origination), and focusing on AI initiatives. She set a target of 90% free cash flow conversion from Adjusted EBITDA by 2030.

Cristopher Kennedy from William Blair & Company asked for an update on Alkami's progress in the bank channel, how Mantle enhances that opportunity, and requested quantification of the termination fees that were recognized earlier than expected.

Answer

CEO Alex Shootman stated that banks now represent 13% of clients under contract and that Mantle's strong presence in the bank market creates a significant new entry point. CFO Bryan Hill quantified the early termination fees at approximately $1 million, noting this represented about 70% of the quarter's revenue beat but also meant the associated subscription revenue is removed from future quarters.

Cristopher Kennedy from William Blair & Company asked for a comparison of the MANTL cross-selling opportunity to past acquisitions like ACH Alert and Segment, and also inquired about the status of MANTL's Loan Origination System (LOS) product.

Answer

CEO Alex Shootman stated he expects the MANTL cross-sell to be more broadly applicable, similar to the Segment acquisition, rather than the more niche ACH Alert. CFO Bryan Hill added that MANTL's established go-to-market should yield success faster than Segment did. Regarding the LOS, Shootman clarified it is still a development effort with select clients, and a decision on a broader market launch will be made after evaluating its success.

Cristopher Kennedy asked about the strategic importance of MANTL's strong presence in the bank and business banking sectors and requested more detail on its path to EBITDA positivity.

Answer

CEO Alex Shootman stated that MANTL's focus on banks and business banking aligns perfectly with Alkami's strategic growth initiatives and also serves the growing commercial needs of its credit union clients. CFO W. Hill reiterated that MANTL's profitability will be driven by revenue scale and leveraging Alkami's G&A and go-to-market infrastructure, projecting it will be accretive to gross margin but a slight drag on EBITDA margin for 2-3 years.

Cristopher Kennedy questioned the long-term savings opportunity from the company's offshoring initiative and how the emergence of open banking in the U.S. might affect its data platform opportunity.

Answer

CFO Bryan Hill detailed that the offshoring strategy, currently involving 110-120 engineering FTEs, is designed to profitably scale innovation and will eventually benefit gross margins through post-sale operations. CEO Alex Shootman addressed open banking by stating its pace is still unknown and that current data investments by clients are driven by the immediate need to compete with mega-banks, not by open banking regulations, which he sees as a potential future tailwind.

Cristopher Kennedy asked for an update on Nayax's embedded banking and e-commerce opportunities, particularly their positioning for 2026. He also inquired about the average transaction value (ATV) across different verticals, contrasting traditional vending with higher-value segments like EV charging, amusement, and car washes.

Answer

Yair Nechmad (Co-Founder and CEO) stated that embedded banking is internally almost complete and ready to launch in Q1 2026, primarily in the U.S., with production rollout in Q2 and Q3, aiming to provide working capital solutions via Nayax Capital. He confirmed e-commerce, initially for EV, will also roll out in 2026. Aaron Greenberg (Chief Strategy Officer) added that e-commerce pilot testing began in the U.S. in October. Sagit Manor (CFO) explained that ATV is growing faster than transaction volume due to higher-ticket verticals like car wash, laundromat, and EV. Aaron Greenberg provided specific ATVs for DC ($18) and AC ($4-$5) EV chargers, noting the focus on net take rate and improved processing gross margin (from high 20s to high 30s) due to acquirer negotiations and smart routing. Yair Nechmad highlighted the remote pricing platform's role in increasing ATV by allowing customers to adjust prices for inflation.

Cristopher Kennedy inquired about the embedded banking and e-commerce opportunities, their positioning for 2026, and the average transaction value (ATV) across different verticals like traditional vending, EV, amusement, and car washes.

Answer

Yair Nechmad, Co-Founder and CEO, stated that embedded banking is ready for a Q1 2026 launch in the U.S., focusing on working capital solutions. Aaron Greenberg, Chief Strategy Officer, added that the e-commerce pilot for EV charging began in October 2025. Sagit Manor, Chief Financial Officer, and Aaron Greenberg explained that ATV is growing faster than transaction volume due to higher-value verticals like EV charging ($18 for DC, $4-5 for AC), car wash, and laundromat, contributing to improved processing gross margins.

Cristopher Kennedy of William Blair asked about the trend in Net Revenue Retention (NRR) given the changing business mix, and requested an update on the company's hospitality and retail initiatives.

Answer

CEO Yair Nechmad stated that NRR is supported by the shift to higher-ticket verticals like EV and parking. CFO Sagit Manor confirmed a strong 123% NRR, driven by healthy ARPU and ATV growth. Regarding new initiatives, CEO Yair Nechmad noted progress in retail with significant news expected in the next six months, while CSO Aaron Greenberg highlighted strong demand for their hospitality kiosk solutions in the Brazilian market.

Cristopher Kennedy of William Blair asked about the future trend for Net Revenue Retention (NRR) and requested an update on the company's progress with its hospitality and retail initiatives.

Answer

CEO Yair Nechmad and CFO Sagit Manor stated that NRR remains strong, driven by growth in both services and processing, with emerging higher-ticket verticals like EV and parking boosting average transaction value. CSO Aaron Greenberg added that on the hospitality front, the company is seeing strong demand for its kiosk solutions in Brazil, while CEO Yair Nechmad noted that for retail, the company is testing direct-to-customer initiatives and expects significant news within six months.

Cristopher Kennedy from William Blair questioned the future trend of Net Revenue Retention (NRR) as the business mix evolves and asked for an update on the company's strategic initiatives in the hospitality and retail sectors.

Answer

CEO Yair Nechmad stated that NRR is supported by growth in higher-ticket verticals like EV and parking. CFO Sagit Manor confirmed the NRR was a strong 123%, reflecting healthy ARPU growth and low churn. Regarding new verticals, Nechmad noted strong demand in retail initiatives with news expected in the next six months. CSO Aaron Greenberg highlighted the successful rollout of a food services kiosk solution in the Brazilian hospitality market.

Cristopher Kennedy asked if the company could provide insight into the potential growth rate in fiscal 2027, given the Rule of 40 commentary. He also inquired about the specific market drivers contributing to the currently strong pipeline of opportunities.

Answer

CFO Greg Orenstein stated that the company is focused on executing in FY26 and did not provide a specific growth target for FY27. CEO Sean Desmond attributed the strong pipeline to three factors: a more supportive macro environment, the AI technology inflection point driving outcome-based conversations, and an intense internal focus on execution and pipeline management.

Cristopher Kennedy from William Blair asked about the drivers of the decelerating subscription revenue growth expected in fiscal 2026 and its implications for fiscal 2027. He also inquired about how the ACV mix by product category might evolve over the next three years.

Answer

CFO Greg Orenstein attributed the expected deceleration to difficult year-over-year comparisons in the second half of the year, consistent with commentary from the previous quarter. CEO Sean Desmond noted that while core commercial remains healthy, the future product mix will depend on market dynamics, but the company's diversified platform positions it well regardless of which line of business is strongest at any given time.

Cristopher Kennedy asked for perspective on the evolution of the consumer lending product and the expected mix of business between commercial, mortgage, and consumer lending over the next 3-5 years.

Answer

CEO Sean Desmond attributed recent consumer lending momentum to product maturity, robust integrations, and improved speed, with a focus on the credit union market providing a key feedback loop. CFO Greg Orenstein added that with over 70% of the company's SAM outside of commercial lending, they have high expectations for the consumer segment, reinforced by recent large bank wins.

Cristopher Kennedy asked for an update on the full-year revenue churn expectation and requested a preview of the new financial KPIs the company plans to disclose.

Answer

Chief Financial Officer Greg Orenstein confirmed the full-year revenue churn expectation remains around 5%, a significant improvement from the prior year's 9%. He declined to preview the new KPIs, stating that the updated framework will be formally announced with the fourth-quarter earnings report.

Cristopher Kennedy asked how the ACV (Annual Contract Value) mix is expected to evolve over the next three years, considering the new product portfolio and pipeline trends.

Answer

CEO Pierre Naude projected three key trends: non-commercial products will continue to represent over 50% of bookings, the mix of new business will likely settle around 60% cross-sell and 40% new logos, and U.S. bookings will probably outpace international growth due to the market's size and nCino's broad product set, including a new focus on credit unions.

Cristopher Kennedy of William Blair asked for an update on Jack Henry's overall SMB strategy and its progress relative to initial expectations, with a focus on Banno for Business and Tap to Local.

Answer

President & CEO Greg Adelson expressed that he is extremely excited and that the SMB strategy is ahead of his expectations, particularly because the development and certification process with Move was completed in ten months instead of the expected 18-24. He stated that the company has a detailed 18-24 month roadmap for the SMB solution set and will begin a heavy rollout after the September client conference.

Cristopher Kennedy from William Blair asked for commentary on the current operating environment for Jack Henry's financial institution clients and requested an update on the company's product rationalization efforts.

Answer

President and CEO Greg Adelson characterized the client operating environment as optimistic, with a strong demand for technology that helps grow deposits, increase loans, and build efficiency. Regarding product rationalization, Adelson confirmed that the company is actively progressing on plans to divest, sunset, and 'cash cow' certain products as previously outlined.

Cristopher Kennedy asked for details on the revenue opportunity for the new Data Broker product and how the CFPB's 1033 open banking rule impacts the business.

Answer

CEO Greg Adelson explained that Jack Henry is well-positioned for the CFPB's 1033 rule, having already eliminated screen scraping in its Banno platform and established direct API integrations with leading data aggregators. He described Data Broker as a single repository for a client's core, digital, payments, and fraud data, which is currently in early adopter phase. He noted that while it's not expected to be a significant revenue contributor in FY25, it should help drive growth in FY26.

Cristopher Kennedy of William Blair & Company, L.L.C. inquired about the progress of leveraging Green Dot's bank and balance sheet for profitability and asked for an update on the company's strategic review.

Answer

Interim CEO William Jacobs described the balance sheet optimization as being in its early stages, with more portfolio repositioning planned for the remainder of the year. CFO Jess Unruh added that the strategy involves deploying cash into floating-rate securities expected to yield between 5% and 7%. Regarding the strategic review, Mr. Jacobs stated it is still ongoing with no significant updates to provide at this time.

The analyst inquired about the progress and quantifiable impact of leveraging the company's bank and balance sheet for increased profitability, and also asked for an update on the ongoing review of strategic alternatives.

Answer

The company is in the early stages of repositioning its balance sheet, with more changes planned for the remainder of the year. New securities are expected to yield between 5% and 7%. The strategic review is still in progress, and there are no significant updates to share at this time.

Cristopher Kennedy inquired about Green Dot's progress in leveraging its bank and balance sheet to enhance profitability and asked for an update on the company's ongoing strategic review.

Answer

Chairman & Interim CEO William Jacobs stated that the balance sheet repositioning is in its early stages, with more changes planned for the remainder of the year. CFO Jess Unruh elaborated that the plan involves deploying cash into floating-rate securities expected to yield between 5% and 7%. Regarding the strategic review, Mr. Jacobs confirmed it is still underway and that the company will provide an update when there is significant information to share.

Cristopher Kennedy of William Blair asked for a broad overview of the operating environment for embedded finance and Banking-as-a-Service (BaaS), comparing today's market to a few years ago. He also followed up with a question about the current competitive landscape within the BaaS space.

Answer

Executive Chris Ruppel detailed a significant shift in the BaaS market, characterized by a growing awareness of the risks of disconnected tech and bank platforms, more strategically-minded clients, and increasing overall demand. Competitively, Ruppel noted that while the market is active, Green Dot's vertically integrated model, scale, and maturity are key differentiators that resonate with partners, allowing the company to distinguish its value proposition effectively.

Cristopher Kennedy requested more details on the Remitly Wallet initiative, specifically how customers are expected to utilize and spend their balances and what the potential float opportunity could be for the company.

Answer

Co-Founder and CEO Matt Oppenheimer explained that the wallet is a core part of the new RemitlyOne membership program. While all customers can hold balances, members will receive additional benefits like interest-like rewards. He indicated that more comprehensive details about the wallet, Remitly Flex, and the overall membership would be shared at the 'Remitly Reimagined' product event in September.

Cristopher Kennedy from William Blair & Company requested an update on the progress and benefits of Remitly's direct partner integrations.

Answer

CEO Matt Oppenheimer described direct integrations as a core strategic advantage, leading to faster transactions (over 93% dispersed in under an hour), lower costs, and higher reliability. He noted that Remitly's scale creates a flywheel effect, enabling more integrations and continuously improving the customer experience, which in turn drives down support contacts.

Cristopher Kennedy requested more detail on the micro-business opportunity, including the current competitive landscape and how Remitly is leveraging its platform to capture this segment.

Answer

CEO Matt Oppenheimer highlighted the extensibility of Remitly's platform to serve new use cases like micro-businesses, which he distinguished from the well-served SMB market. He shared an anecdote about a self-employed bookkeeping professional who uses Remitly to pay her team of contractors in the Philippines, illustrating how the existing platform can efficiently serve this customer type with minimal incremental investment.

Cristopher Kennedy asked about Remitly's capital allocation strategy across its different growth opportunities, including established markets, emerging markets, and new geographies.

Answer

CEO Matt Oppenheimer explained that the primary challenge is strategic prioritization, not a lack of opportunities. He noted that the majority of near-term growth comes from existing markets. However, the company plans to continue adding new markets in 2025, citing the encouraging 50% YoY active user growth in recently launched regions like Sub-Saharan Africa as a positive indicator.

Cristopher Kennedy asked for Marqeta's perspective on JPMorgan Chase potentially charging data aggregators for data access and the possible impact on its business.

Answer

Interim CEO & CFO Mike Milotich assessed the direct impact on Marqeta as minimal. However, he acknowledged it could create friction and higher costs for customers using real-time account data for services like account verification and underwriting. He concluded it is a dynamic to monitor, especially if other banks adopt a similar model.

Cristopher Kennedy requested an update on the accelerated wage access (EWA) initiative and asked for the company's perspective on the evolving regulatory environment for that product category.

Answer

Interim CEO and CFO Mike Milotich stated that the EWA business continues to grow with several programs live, and Marqeta is working to enhance its value proposition, citing a recent partnership with Rain. He noted that Marqeta's approach, which distributes already-earned money rather than providing a loan, is viewed as a better long-term solution that avoids some of the regulatory scrutiny facing traditional EWA models.

Cristopher Kennedy inquired about Flywire's long-term (3-5 year) growth profile given its business evolution and asked for more detail on the 12% of new Certify sales coming from international markets.

Answer

CEO Mike Massaro stated that the long-term growth algorithm remains focused on NRR, new client wins, and the goal of doubling the business, supplemented by inorganic opportunities. President & COO Rob Orgel added that Certify's international growth is an exciting early development, leveraging Flywire's global platform to expand beyond Certify's original focus on U.S. and English-speaking markets as part of a multi-year plan.

Cristopher Kennedy asked about the Net Revenue Retention (NRR) opportunity in travel versus education and questioned the long-term outlook for the company's overall NRR, which has moderated from historical levels.

Answer

CFO Cosmin Pitigoi explained that while travel has strong land-and-expand characteristics, its NRR profile differs from education. He attributed the recent decline in overall NRR to significant macro headwinds in markets like Canada and Australia, stating that in a normalized environment, growth would be much faster. CEO Mike Massaro added that layering more software into the travel vertical will be a key future growth driver.

Cristopher Kennedy asked for more detail on the healthcare vertical's return to growth and the specific actions Flywire took to achieve this improvement.

Answer

President and COO Rob Orgel attributed the healthcare vertical's return to modest year-over-year growth to success in both adding new clients and expanding with existing ones, citing the 'Banner One' initiative with Banner Health as a key example. He noted that while the result is positive, the company expects healthcare to be a moderate growth business relative to Flywire's overall corporate average.

Cristopher Kennedy from William Blair asked for an update on FIS's international strategy, particularly in light of the EverLink acquisition.

Answer

CEO Stephanie Ferris explained that the international strategy is being advanced by both the EverLink acquisition and the pending issuer business acquisition from Global Payments. She highlighted that both deals add international payments capabilities and will help FIS expand its footprint in high-demand markets outside the U.S.

Cristopher Kennedy of William Blair asked for Euronet's perspective on the sustainable growth rate for the newly acquired CoreCard business, referencing CoreCard's prior guidance of 30-40% growth excluding its largest client.

Answer

Chairman, CEO & President Michael Brown stated they hope to 'supercharge' CoreCard's growth by leveraging Euronet's global footprint to expand beyond its current U.S. focus. EVP & CFO Rick Weller added that CoreCard has a superior product but has historically underinvested in sales and marketing. He sees a 'hand and glove' fit where Euronet's global distribution and relationships can significantly accelerate sales, though he noted the long sales cycle for credit platform conversions.

Cristopher Kennedy questioned the consumer willingness to pay ATM access fees in Europe, a relatively new concept, and requested an update on the Merchant Services business expansion.

Answer

CEO Michael Brown and CFO Rick Weller explained that European consumers are already accustomed to paying 'disloyalty charges' for out-of-network ATM use, so the new fees have not negatively impacted transaction elasticity. They added that these fees create opportunities for more ATM placements and bank partnerships. Regarding Merchant Services, Brown stated they are in the early stages of expanding into Portugal, Spain, and Italy by replicating their successful Greek model.

Cristopher Kennedy of William Blair asked for more detail on the revenue contribution from newer initiatives like Ren and Dandelion and inquired about the market perception and growth opportunity for the Ren platform, particularly in the U.S.

Answer

CEO Michael Brown explained that Ren's transaction-based model leads to compounding revenue growth as clients expand usage. He noted that while initial adoption was strongest in technologically advanced Asian markets, the launch of FedNow in the U.S. is now creating domestic opportunities. He cited successful deployments connecting banks to real-time payment systems in India, the Philippines, and Africa as evidence of its global traction.

Cristopher Kennedy asked for context on the opportunity from expanding domestic access fees in Europe and inquired about the customer profile, stickiness, and unit economics of the rapidly growing digital money transfer business.

Answer

CFO Rick Weller described the access fee opportunity as a positive directional trend driven by industry-wide cost pressures, which improves Euronet's profit per transaction and market share as banks retreat. CEO Michael Brown explained that digital money transfer customers are banked, sticky, and acquired through marketing spend. He clarified that while digital transactions avoid agent commissions, the marketing costs make them only 'slightly more profitable' than traditional transactions.

Cristopher Kennedy from William Blair requested an update on cross-selling initiatives and asked about the long-term benefits of the data center migration to the public cloud.

Answer

CEO Matt Flake expects a strong back half for cross-selling, spurred by the recent client conference. CFO Jonathan Price and President Kirk Coleman detailed the cloud migration benefits, including near-term cost savings in 2026 from exiting data centers and long-term strategic advantages in leveraging cloud-native technology and AI.

Cristopher Kennedy requested more detail on the 2026 subscription revenue growth outlook and asked for commentary on the M&A environment and capital allocation.

Answer

CEO Matt Flake and CFO Jonathan Price reiterated confidence in the 13%+ subscription revenue growth floor for 2026 but stated it's too early for updates, as it depends on 2025 execution. CFO Jonathan Price added that while the M&A pipeline is active, target valuations remain high, and the company will remain disciplined in its capital allocation.

Cristopher Kennedy inquired about the trajectory of subscription revenue growth, given the 16% forecast for the current year and 15% for next year, and asked new CFO Jonathan Price about his key priorities.

Answer

CFO Jonathan Price attributed the 2024 outperformance to strong cross-sell and renewal activity. For his priorities, he emphasized continuing the profitable growth strategy, strengthening the balance sheet through improved cash flow, and investing to maintain market leadership.

Cristopher Kennedy of William Blair inquired about the potential for M&A through the Cynquia asset, given its history of acquisitions. He also asked about EVERTEC's strategic priorities for growth in the Mexican market.

Answer

President & CEO Mac Schuessler responded that after focusing on integrating Cynquia and restoring its growth, EVERTEC is now confident and actively looking at bolt-on acquisition opportunities in Brazil. Regarding Mexico, he stated it remains a key focus for growth, particularly in issuing, and the company is leveraging the capabilities from the Grandada and Nubity acquisitions to open up new conversations and actively seek further opportunities.

Cristopher Kennedy asked for a characterization of the reaccelerating Brazil business relative to its performance when first acquired. He also inquired if any other Latin American economies, beyond Brazil and Chile, stand out as ones to monitor closely.

Answer

President and Chief Executive Officer Morgan Schuessler stated that following a leadership change and initiatives around customer engagement, platform modernization, and contract repricing, the Brazil business's growth is back within expectations. He noted Brazil is the most significant country to watch due to its size and currency fluctuations but confirmed no material economic impact has been seen to date across the region.

Cristopher Kennedy of William Blair & Company inquired about the progress of introducing EVERTEC's core payment processing business into the Brazilian market via the Sinqia acquisition. He also asked about the company's confidence in its ability to manage the upcoming 10% MSA discount with Banco Popular.

Answer

CEO Mac Schuessler explained that the initial focus with Sinqia was on improving its existing business verticals, which is now showing reacceleration. While there have been small wins in payments, it will be a renewed focus going forward. He affirmed high confidence in navigating the MSA discount, stating that cost efficiency initiatives were implemented early in 2024 and have already positively impacted margins, preparing them well for the change in late 2025.

Cristopher Kennedy inquired about the progress of introducing EVERTEC's payment processing services into the Brazilian market through Sinqia. He also asked about the company's confidence level in its ability to manage the upcoming 10% MSA discount with Banco Popular.

Answer

CEO Mac Schuessler explained that the initial focus with Sinqia was on strengthening its existing business verticals, which is now showing success. While there have been small wins in payments, it will be a renewed focus going forward. Regarding the MSA discount, Schuessler expressed high confidence, citing a major cost-efficiency initiative already underway that positively impacted Q4 2024 margins and has the company well-prepared.

Cristopher Kennedy of William Blair shifted topics to ask for the company's latest views on stablecoins and the implementation of blockchain technology, referencing a recent announcement with Coinbase.

Answer

Chairman and CEO Stephen Squeri provided a detailed view, stating that stablecoins have a role in the payment system, particularly for cross-border B2B transactions. He positioned the Coinbase partnership as providing an 'off-ramp' for customers to use rewards to earn digital currency. He clarified that while digital currencies will not replace existing payment rails, they are a good alternative to traditional wire transfers, and Amex will be an important participant in the ecosystem.

Cristopher Kennedy requested a 'state of the union' on the company's SME technology investments, including Kabbage and the recent Center acquisition, and how they will drive organic spend.

Answer

CEO Stephen Squeri described a strategy to build a comprehensive ecosystem for SMEs to increase relevance and retention. Kabbage serves as the central platform for banking and lending, while acquisitions like Nipendo and Center add B2B payment automation and expense management, respectively. He believes this will boost acquisition and retention, with organic spend growth coming from greater B2B payment adoption.

Cristopher Kennedy asked how the allocation of AXP's increased marketing investment has evolved between customer acquisition, brand marketing, and sponsorships.

Answer

CFO Christophe Le Caillec (identified as Robert Napoli) stated that brand and sponsorship spending has been fairly stable. The vast majority of the recent marketing expense growth has been directed toward customer acquisition. This is further split between acquiring new prospects and deepening relationships with existing customers (e.g., upgrades), with the latter being a highly attractive investment that is prioritized.

Cristopher Kennedy of William Blair asked for insights into the lifetime value or average spend by card category as customers typically upgrade from Green to Gold and then to Platinum cards.

Answer

CEO Stephen Squeri explained that as customers upgrade to higher-fee products like the Platinum Card, their spending and engagement increase to take advantage of the richer benefits, particularly in travel. This results in a higher lifetime value. He noted that the entry point is key, with a younger customer upgrading over time likely having a higher LTV than an older customer who acquires a premium card later in life.

Cristopher Kennedy asked which of Riskified's new products are resonating most in the market. He also followed up on whether the long-term target of 15-20% adjusted EBITDA margins by the end of 2026 is still in place.

Answer

CEO Eido Gal responded that the entire platform resonates, but specifically highlighted Policy Protect for its meaningful ROI, citing examples of merchants blocking abusive refund requests and increasing customer satisfaction. Regarding the long-term EBITDA margin target, Gal gave a non-committal answer, stating, 'we're excited by the start of the year and looking forward to continuing to execute.'

Cristopher Kennedy questioned the dynamics behind the decline in Net Dollar Retention (NDR) to 96% from historical levels above 110% and requested more detail on Riskified's role in processing alternative payment methods (APMs).

Answer

Aglika Dotcheva, CFO, attributed the lower NDR to declines in same-cohort sales, a 2024 focus on new logos over upsells, and the impact of the significant churn event. She expressed optimism for NDR to surpass 100% in 2025. Eido Gal, CEO, added that merchants use Riskified to review APM volume due to fraud risks and inefficiencies, utilizing both covered and uncovered models, with a volume mix similar to the global average.

Cristopher Kennedy asked for an outlook on the growth profile for 2025, considering the recent major customer loss against momentum in emerging categories. He also questioned if the company is still confident in its 2026 adjusted EBITDA margin target of 15% to 20%.

Answer

CEO Eido Gal stated that while the churn event is a setback, the company's 2026 adjusted EBITDA margin goal remains its "North Star" and is still considered achievable given the strength in new merchant wins and diversification. For 2025, he noted that strong new logo acquisition is a positive driver, offset by the churn and a more competitive, uneven macro landscape, with no significant macro improvement baked into their model.

Cristopher Kennedy from William Blair & Company asked for a comparison of the revenue opportunity and monthly sales productivity across traditional vending, micro markets, and the newer Smart Stores.

Answer

Executive Ravi Venkatesan detailed the evolution of self-service commerce, positioning Smart Stores as a superior solution that combines the security of vending with the modern experience of micro markets, making them suitable for low-trust public environments. He projected that while vending may grow at 5-6% and micro markets at 30-40%, Smart Stores could see growth of 100-200% in the next 2-3 years. Venkatesan added that operators report micro markets achieve 10x the sales of vending, and Smart Stores can double that figure again, potentially comprising 25-30% of new sales within 18 months.

Cristopher Kennedy inquired about the evolution of Cantaloupe's average revenue per unit (ARPU), its key drivers like business mix and ticket prices, and requested an update on the company's international strategy and revenue mix.

Answer

Scott Stewart, an executive, explained that ARPU growth is driven by increased transaction processing from higher average ticket sizes and new software offerings. CEO Ravi Venkatesan added that a key part of their strategy is intentionally deploying solutions in higher-revenue locations. Regarding international strategy, Venkatesan noted that while the revenue mix remains under 5%, they are seeing positive momentum in Latin America and EMEA, particularly with micro markets, and expect acceleration in the second half of the fiscal year.

Cristopher Kennedy of William Blair & Company inquired about the fiscal 2025 subscription and transaction revenue guidance of 15-20% compared to the prior outlook, the expected mix between subscription and transaction growth, and the strategic rationale for the SB Software acquisition.

Answer

Executive Scott Stewart clarified that the 15-20% guidance range is consistent with the previous outlook of '18-plus percent,' with the midpoint being similar. He projected subscription revenue growth around 15%+ and transaction revenue growth at 18%+. Executive Ravi Venkatesan added that the SB Software acquisition provides a strong customer base in the UK and Ireland, creating significant cross-sell opportunities for Cantaloupe's cashless payment devices, micromarket solutions, and other software add-ons.

Cristopher Kennedy inquired about the competitive landscape within the Travel Money business and asked for an update on how unit economics are trending in the digital business.

Answer

CEO Devin McGranahan clarified that Western Union competes in the 'local' segment of the Travel Money market, catering to migrants and mid-trip travelers, which has better pricing characteristics than the 'on-airport' segment. Regarding digital economics, CFO Matt Cagwin and CEO Devin McGranahan both stated that the LTV to CAC ratio has improved meaningfully. This was achieved by reducing customer acquisition costs (CAC) while simultaneously increasing customer lifetime value (LTV) through higher retention and customer quality, validating their strategic focus.

Cristopher Kennedy of William Blair asked for more detail on the strong performance of the digital business in Australia, questioning what dynamics are driving its success and if this model can be replicated in other markets.

Answer

CEO Devin McGranahan, having recently visited, attributed the success in the highly competitive Australian market to the quality of the product and the strength of the Western Union brand, particularly for payouts across the APAC region. He noted that Australia was the first market to launch the next-generation digital platform, which has led to high customer conversion and repeat usage. He affirmed that this success is 'completely repeatable' and that the company plans to accelerate the platform's rollout to over 10 more countries in 2025.

Cristopher Kennedy asked for details on the volume sensitivity of the non-mortgage business and inquired about the sustainability of the 41% EBITDA margin target for 2025.

Answer

Chief Financial Officer Elias Olmeta stated that while the company is not providing specific disclosures on consumer volume sensitivity at this time, it is something they will consider for future calls. Regarding margins, Olmeta explained that the 41% guidance reflects the timing of investments that will ramp up in the second half of the year, leading to higher margins in Q1 and the first half before moderating. He affirmed the company's disciplined approach to cost control.

Cristopher Kennedy of William Blair & Company, L.L.C. asked about MeridianLink's potential revenue growth rate in a normalized macroeconomic environment.

Answer

CFO Elias Olmeta stated that in a normalized environment, transaction volumes would shift from a headwind to a mid-single-digit tailwind. After a brief misstatement, he clarified, with CEO Nicolaas Vlok's prompting, that this would enable the company to achieve its long-term revenue growth target in the mid-teens, consistent with historical guidance.

Cristopher Kennedy asked about MeridianLink's potential growth profile in a more normalized macroeconomic environment.

Answer

President and CFO Larry Katz reiterated the company's target growth algorithm of mid-teens growth. He explained that the primary delta between current performance and that target is the headwind from lending volumes. Once volumes normalize from the current negative impact to their historical mid-to-high single-digit growth rate, the company can achieve its mid-teens growth profile.