Ryvyl - Q1 2024

Transcript

Operator (participant)

Good afternoon, everyone, and welcome to Ryvyl Inc's First Quarter 2024 Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the management's remarks. The earnings press release accompanying this conference call was issued at the close of the market today. The quarterly report, which includes the company's results of operations ended March 31, 2024, was filed with the SEC today. A replay of this call is available on the Investor Relations section of the Ryvyl website in the Events/Quarterly Earnings sections. As a reminder, this call is being recorded. Before we begin, I would like to remind you that today's call contains certain forward-looking statements from our management concerning future events.

These forward-looking statements are based on the company's current beliefs, assumptions, and expectations regarding future events, which in turn are based on information currently available to the company and contain projections of future results of operations or financial condition or state, other forward-looking information. By their nature, forward-looking statements address matters that are subject to risk and uncertainties. A variety of factors could cause actual events and results to differ materially from those expressed or contemplated by the forward-looking statements. Other risk factors affecting the company are discussed in detail in the company's filings with the SEC. The company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except to the extent required by applicable laws. I will now hand the call over to Ben Errez, Chairman of Ryvyl.

Please go ahead.

Ben Errez (Chairman)

Thank you. Good afternoon, everyone, and thank you for joining us today. In the First Quarter of 2024, we delivered solid growth, with revenue increasing 49% over the same period in 2023, reflecting particularly strong international results, which grew 185% compared to first quarter of 2023. Processing volumes continued to grow, reaching $994 million in the first quarter of 2024, up 5% compared to the fourth quarter of 2023, with our international segment increasing 28% to $755 million. However, as expected and reviewed in March, revenue declined sequentially due to near-term issues affecting our North America business. I'll provide an update and review some of the actions we've taken to manage the situation. New regulations and the overall compliance environment related to some of the high-risk verticals we service led us to change banking partners and begin a product transition in the North American merchant services segment.

In addition to implementing cost control measures, we are accelerating business development efforts to drive volumes in new vertical markets, such as insurance and online businesses. As we expand markets, we have built a sales pipeline in new verticals that we believe will begin to further ramp North American business volume in third quarter of 2024. Additionally, we are investing in engineering and development to enhance our product offerings. One factor driving new business is the shift from terminal-based processing to mobile-app-based processing. This transformative change will help us expand our customer base by reaching into new verticals and increase business retention by improving service and engagement with existing customers, both at the merchant level as well as the consumer level. Now, I'll discuss some of our key growth initiatives and achievements. Expanding our international business is a strategic priority.

As the first Visa partner in the Balkan region, we completed testing the new Visa Direct integrated services and are pleased to share that we are now activated in production to offer Visa Direct payouts for our business clients. The integration will enable Ryvyl EU to leverage Visa Direct's network capabilities, provide superior Banking-as-a-Service, and create new revenue streams. Our partnership will enable customers to send funds to authorized accounts, e-wallets, and debit cards in over 80 countries across multiple currencies. In February 2024, Ryvyl EU formed a collaboration with ACI Worldwide, a global leader in mission-critical, real-time payments software. We plan to onboard our e-commerce merchant payment service provider customers onto the award-winning ACI Payment Orchestration Platform, enabling them to orchestrate payments using one solution, one platform, and one API integration for optimal conversion rates and minimal operational costs.

This integration will allow merchants and PSPs to provide customers with a more seamless and secure customer journey. We are integrating the ACI solution into our offering and expect it to be released by early third quarter. We retained our Coyni technology to leverage as part of our total suite of solutions for more efficient and highly scalable transaction processing in both North America and eventually in the EU. Coyni provides an easy-to-use customer experience. We have been testing Coyni's mobile-based processing in the U.S. in the first quarter and expect to formally launch this summer and ramp volume over the course of 2024. In the EU market, we received license and merchant processing approval for Coyni, and we have a clear line of sight for additional business opportunities.

Our Banking-as-a-Service offering continued to gain traction this quarter as transaction volume exceeded an impressive $600 million with the support of several institutional and banking partners. Our Banking-as-a-Service platform offers API integrations and foreign exchange capabilities in more than 40 different currencies with local settlements. The service authorizes transactions 24 hours a day on business days and enables payout methods including real-time electronic funds or direct deposits. In addition, our Banking-as-a-Service readily traces transactions, reduces fraud, and maintains strict compliance requirements. We expect this strategic offering will be a long-term growth driver in a lucrative market. Now to discuss the details of our financial results, I'd like to turn the call over to our Chief Financial Officer, George Oliva. George, the floor is yours.

George Oliva (CFO)

Thank you, Ben. I'll review our first quarter of 2024 financial performance. Revenue increased 49% to $16.8 million compared to $11.3 million in the first quarter of 2023, reflecting growth in our acquired businesses and Ryvyl EU and our continued expansion of our independent sales organization known as an ISO and partnership network. North America revenue increased 10% to $9.7 million for the first quarter of 2024 compared to the first quarter of 2023. International first quarter revenue increased 185% to $7.1 million for the first quarter of 2024 compared to first quarter 2023. Cost of revenue was $9.7 million for the first quarter 2024 compared to $6.2 million in first quarter of 2023. The increase is primarily attributable to growth in transaction volume, which resulted in higher processing fees paid to gateways and commission payments to ISOs in both North America and international segments.

Operating expenses were $8.9 million compared to $8.8 million for the first quarter of 2023. Other expenses totaled $600,000 for the first quarter of 2024 compared to other expense of $4.3 million for the first quarter of 2023. Our debt reduction strategies resulted in a $1.7 million decrease in interest expense and a $1.7 million decrease in accretion of debt discount. Adjusted EBITDA was -$0.8 million in the first quarter of 2024 compared to -$3.0 million in the first quarter of 2023. Regarding liquidity, we are carefully managing our capital. Leveraging our strong growth in the EU, we repatriated $7.5 million to date from Europe to shore up the U.S. capital resources. At the corporate level, as of March 31, 2024, cash and restricted cash balance was $88.2 million, unrestricted cash was $10.5 million, and working capital was $3.2 million.

I will now turn the call over to Min Wei, our Chief Operating Officer, to provide a review of business operations and our outlook.

Min Wei (COO)

Thank you, George. I'll detail the processing volumes for our verticals, discuss some first quarter highlights, and then provide the outlook for the second quarter of 2024. Our first quarter processing volume across all channels was $994 million versus our expected volume of $900-$950 million. This is about a 5% increase sequentially and an increase of about 76% from our first quarter 2023 volume. Our North America merchant services business, including Ryvyl Block, ChargeSavvy, American Samoa, and other portfolios, processed $239 million in the first quarter, about 33% lower than the fourth quarter's $356 million volume and 21% lower than the same period a year ago. This is primarily attributable to the reduced processing volume for some of the high-risk verticals we service and coincides with the product transition from terminal-based processing to mobile-app-based processing.

We expect North America volume recovery to pick up steam in the second half of this year. For our FX and international payments portfolio, including the acquired Transact Europe business, now Ryvyl EU, and our new Banking-as-a-Service offering, we processed $755 million in the first quarter compared to $590 million in business volume in the fourth quarter, an increase of 28%. This represents a 140% increase from the first quarter of $315 million in the first quarter 2023. We are making major strides in technology development to augment our product offerings and drive new revenue streams, as communicated on the last call. We introduced our mobile-app payment channel and mPOS capability for delivery businesses in the U.S. We are making rapid progress on PayFac as a service and independent software vendor partnerships that will further complement our existing sales channels.

In the EU market, we are close to completing a revamp of our banking system software that connects with our partners and allows faster money movements for our business customers. We expect the EU growth momentum to continue at a faster pace than planned and help offset part of the near-term slowdown in North America. Turning to our outlook for the second quarter, we expect processing volume to be in the range of $850 million-$900 million. This is lower than in first quarter 2024 volume due to compliance and regulatory changes in some of the U.S. high-risk verticals we service and that has effectively curtailed transactions. We are improving our product solution that is being rolled out to rebuild the volume. Our total year 2024 volume expectation is over $5 billion.

For our second quarter revenue outlook, we expect to be in the range of $12-$14 million, a decrease of approximately 17%-28% sequentially and a 5%-19% decrease year-over-year. As we rebuild the business volume for the verticals we service in the U.S. in the coming few months, we will advise if we have any material change to the total revenue guidance of $90-$100 million. We are maintaining our target for full-year Adjusted EBITDA at $1-$5 million. This concludes my remarks. I'd like to now turn the call back to Ben Errez, our Chairman, to begin our Q&A.

Ben Errez (Chairman)

Thank you, Min. Prior to this call, we have received a number of questions that are of interest to all shareholders. Before opening the Q&A to analysts, we'll address those. The first question I'll direct to Fredi. Why are you confident that you'll be able to double the revenues in the second half of 2024 compared to the first half?

Fredi Nisan (CEO)

Thank you, Ben, and thank you for everyone listening. We expected to continue a great momentum in Europe via our PSP, what we call ISOs, and agent portfolio in Europe and in the U.S. We are opening new verticals and especially very excited about the PayFac as a service solution and licensing model that we put in Europe and implementing as well in the U.S. for our revenue stream and growth. Second is our relationship with ACI. We announced it a few months back about our relationship with this new gateway, and we are in the integration process, and we hope to get it live in the beginning of Q3.

That will enable us to turn on and move our customer into this platform to allow a faster integration and other solutions that exist with this relationship, for example, tokenization system with a new network of Visa and Mastercard, Point of Banking to offer a quick push to cards and Visa Direct, and other great features that they bring to the table. The third one that we are very excited to announce is Visa Direct. We just finalized the integration and certification with Visa, and we can go live now and push money through that new network and relationship. That will allow us to leverage the Visa Direct network to push money in 80 different countries. We started with the first five, and we already started pushing money in Canada.

So very excited about this and leveraging that solution and offer that to our businesses and Banking-as-a-Service and, of course, our PayFact solution. So very, very excited. This is how we see the company grow in the second half of this year. So very excited. Thank you.

Ben Errez (Chairman)

Thanks, Fredi. The next question is for Min. How did revenue trend in Q1? What is being done to rebuild momentum, and what is your forecast for profitability?

Fredi Nisan (CEO)

Thank you, Ben. To answer the question, our Q1 was affected due to changes in technology and banking compliance issues impacting some of our high-risk verticals, which have continued into Q2. As we reported, these issues have affected the U.S. while Europe continues on a stronger growth trajectory. In the U.S., we're expanding into new verticals to diversify, and we're working on specific identified business opportunities in these new verticals. In addition, we started to monetize our platform as a service licensing business that do not have the same constraints that affected the Q1 results. Although these new revenue streams will take time to materialize, we are building momentum in these new verticals.

In terms of the question about profitability, based on our expected revenue and expense run rates, we expect that just the EBITDA in the second half to be positive and the full year to be in the range of $1-$5 million. As we have stated in the past, at $100 million revenue, we should be positive EBITDA, and at the $120 million revenue, we expect to be profitable. It is our plan to continue focusing on resources to accelerate revenue growth and reduce non-critical spending to reach our profitability objectives.

Ben Errez (Chairman)

Thanks, Min. The next question is for George. Are you comfortable that you have enough liquidity to sustain the faster profitability? Why did you pull the raise, and what is your plan to manage the notes coming due in April of 2025?

George Oliva (CFO)

Thank you, Ben. First, regarding the proposed raise, we had started the process in Q1 when the stock price was higher. However, as it came closer to fruition, pricing was not attractive. We made the decision, the determination, that it was not in the best interest of shareholders to accept the terms, and so we canceled that raise. Rather than raising equity, we pursued a strategy to accelerate repatriating cash from Europe to the U.S. Fortunately, they are very profitable and are ahead of plan, and we were able to repatriate $7.5 million to date from the EU to help subsidize the temporary loss of processing in the U.S. Our cash and cash equivalents are challenging in the North America segment. We are moving money between the other business units, and we are being very aggressive in cost control to help manage the liquidity needs.

It's a challenging operation to have multiple business units, some with increasing revenue, some with decreasing revenue. We're managing working capital very tightly and centralized in the U.S. Regarding the note, we have extended the maturity of the note in the past, and we are again in active discussion with the noteholder to do so again. Next quarter, the note would be due within one year and affect our current ratios. We're going to get that hopefully extended and continue to classify it as a long-term obligation. With that, I'll give that back to Ben.

Ben Errez (Chairman)

Thank you, George. I'm going to take the next question. How do you measure your success? Or another way of saying this, what are the most important key performance indices? Where are you doing better, and what trends do you expect in 2024? So I do like data science. In fact, shout out to my son, who is a data scientist. The best way to measure the success is using key performance indicators. The most meaningful KPIs for Ryvyl include total volume of transactions, operating margins, and revenue. Our company business grew 83% to $3.1 billion in 2023, and we expect a 67% volume growth in 2024. In terms of operating margin, which is always a challenge in rapidly growing companies, we continue to automate and streamline cost control.

We are happy to report that our operating margin run rate is in the high 30s, low 40s, in spite of the substantial growth in revenue. In terms of revenue growth, we finished 2023 with about $66 million in revenue. Based on our robust pipeline and new offerings, we anticipate that to grow in 2024 at approximately 35%-50%. Based on the current environment, we're quite pleased with this progress. The last question is back to Chief Operating Officer Min Wei. Revenue growth is critical for the success of the company. What are the top three sources for revenues?

Fredi Nisan (CEO)

Thank you, Ben. Our top three sources of revenue are as follows. Number one is our merchant acquiring service revenue. Number two Banking-as-a-Service revenue, and we are gaining significant momentum in the European market, as mentioned earlier. Number three are the revenues from the new verticals and the anticipated licensing revenue from PayFact as a service offering, which is due to go to market through the independence of our vendor partnerships Fredi mentioned earlier. In addition, we recruited more specific resources with payments experience, and the speed of onboarding is improving, giving us confidence in stronger growth in the second half of the year.

Ben Errez (Chairman)

Thank you, Min. Operator, at this point, we would like to open the floor for analyst questions. We see that several analysts have registered for questions.

Operator (participant)

Sure. Thank you. At this time, we will be conducting a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question comes from the line of Kevin Dede with H.C. Wainwright. Please proceed with your question.

Kevin Dede (Managing Director and Senior Technology Analyst)

Thank you for having me on, Ben and Min. It's good to talk to you again.

Ben Errez (Chairman)

Same here.

Kevin Dede (Managing Director and Senior Technology Analyst)

So exactly when was the Visa Direct integration complete? Was there any contribution to the March quarter, or how far through the June quarter? What kind of results have you seen so far?

Ben Errez (Chairman)

I'm going to have Min address that. Go ahead, Min.

Fredi Nisan (CEO)

Hey, Kevin. Thank you for the question. So it just recently completed the second quarter, so it was after the first quarter. And then we went live with services. As Fredi indicated, our initial currencies we covered in phase one are five currencies, including GBP, U.S. dollars, euro, and Canadian dollars. We already went live with business in Canada, and shortly after that, we expect to launch into the rest of the phase one currencies. So we expect to see some improved revenue coming from the Banking-as-a-Service part of our business as a result of that.

Kevin Dede (Managing Director and Senior Technology Analyst)

Okay. Ben, I'm a little tripped up on the slowdown in the March quarter. On one hand, and this is on me, right? I'm not sure that I heard everything correctly. On one hand, I heard about the transition from a terminal to mobile platform. And on the other hand, I heard about an issue with regulations. So if we could drill down on each of those issues, please, maybe I can come to understand how you see a stronger second half.

Ben Errez (Chairman)

Yeah. I'm going to leave the mic with Min.

Fredi Nisan (CEO)

Kevin, I think that's a very specific maybe multiple questions there. But at a high level, in Q1, we did run into the technology and compliance requirements change through our processing channel. We were adjusted for that six months right away. Really, the recovery path we're referring to here, Kevin, is that in conjunction with our switch to mobile payment, mobile app processing payment processing excuse me. My apologies for that. And we have fine-tuned the way we process payments for our customers, our merchants, in a more compliant manner. So we're able to switch gear, adjust for that, and roll out a more compliant solution. But even with that, it does take time for us to rebuild the user base because, as we mentioned in the last earnings call, we expected for the consumers to change their behavior and adopt a new payment experience. It's going to take time.

We're working very hard to put together the communication material training program so that as we fully roll out the mobile-based payment solution, we can ensure that we provide not only the training but also the incentive to the end users to adopt. As a result of that, Kevin, we have updated and adjusted our revenue forecast. Hence, we made the comment earlier. We expect to rebuild momentum towards the later part of the second quarter, but then we really expect the steam to be picked up starting in the early part of Q3.

Ben Errez (Chairman)

Yeah. I would add to that, Kevin, that we like this transition out of hardware into software. It's better for the company. It's easier to manage inventory. Updates are much faster. All of that leads to better margins. We like that trend. Our customers like it. They have no expenses on hardware. This is a good trend. It just takes a little bit of time transitioning and onboarding the old paybook or portfolio onto the new platform.

Kevin Dede (Managing Director and Senior Technology Analyst)

Okay. Maybe, Ben, you could offer a little color just on the regulatory side of things because I'm still a little confused by that.

Ben Errez (Chairman)

To say that we are not confused by it would be an issue. We work in an environment that is an ecosystem that is fed by a lot of different contributors. A lot of times, we see trends that are influenced by perception. Sometimes it's a perception of risk by association. Sometimes it's perception of risk for verticals. Sometimes it's an interpretation of regulation that otherwise are not very clear. A lot of our partners are telling us, "If you do business this way, we will have to reduce your bandwidth. And if you do it in another way, then you'll have full roaming ground." It's better for us to listen and follow these guidelines, even if they are not always mandated from the regulatory perspective.

Fredi Nisan (CEO)

And let me add one more thing just for what Ben just mentioned. I think it's important. Banking and acquiring processing, the whole industry is changing. FDIC is pushing hard on the banking, on the risk, on capacity. Visa just lost a lawsuit, need to pay $30 billion for fees. The whole industry, the whole ecosystem is changing. And we are just part of that ecosystem. And we are following the guidance of the partners. And we have to adjust to those requirements. And part of it is moving into a technology that is more secure, more transparent, for example, mobile apps. In Europe, they have new set of rules as well that are going into certain areas, especially in the crypto area, in licensing. So the whole world is changing, and we're just adjusting with it. So that's kind of a high level.

Kevin Dede (Managing Director and Senior Technology Analyst)

If I look at revenue as a percentage of transaction volume, I get to about 1.7% in the March quarter, which is down from, I think, over 2% in December. So can you help me understand that trend and how you think it goes? Obviously, it's a function of volume, but given there's only a 5% change in volume, it's hard to see that much of a change in revenue versus a percentage of transaction volume.

Ben Errez (Chairman)

Okay. Min?

Fredi Nisan (CEO)

Kevin, I'll address that question. That's a group of observations, right? That means you really are into the detailed data analytics of our business. At a high level, as I mentioned earlier, our top three revenue drivers, one, is merchant acquiring service revenue. Number two is banking as service revenue, right? So what happened is sequentially between the last quarter of 2023 and the first quarter of this year, even though when we have reduced volume for North America acquiring and processing revenue and due to reduced volume we process, that said, we more than offset that by having a smarter increase in Banking-as-a-Service revenue and volume in Europe. So that's one observation, right? Number two is residual percentage. I think that's basically what you're looking at, is the ratio between revenue compared against volume.

Kevin Dede (Managing Director and Senior Technology Analyst)

The residual percentage for Banking-as-a-Service revenue is lower than the acquiring in the business we have. So as a result of that, when you have increased volume for banking as service revenue but then has a lower residual percentage compared to higher residual percentage for the acquiring business, that's why you see even though we have improved volume overall, but then the residual percentage probably declined quarter-over-quarter because of that. Okay? Hopefully, that makes sense to you.

Ben Errez (Chairman)

So I would add so that is basically a mix between Europe and the U.S. As Europe is a larger percentage of our business, that's why that overall rate declined. Even though Europe is very profitable, but the residual rate is lower on the transactions than we had in the U.S. So I do think 2% is still a good ballpark metric long term.

Right. And this is Ben again. This is the area where we anticipate a stabilized performance to go back to the original performance. I would also, Kevin, direct your attention to what I said before, to a previous question about the KPIs. Our gross operating margins have not changed, even though our percent of revenue out of volume may be shrunk just a little bit. So that's a very important distinction.

Kevin Dede (Managing Director and Senior Technology Analyst)

Thank you for highlighting that, Ben. I appreciate it. Thank you very much for your explanations, gentlemen. I'll hop back in the queue.

Ben Errez (Chairman)

Thanks, Kevin. We always appreciate your support. Operator, back to you.

Operator (participant)

Thank you. As a reminder, if anyone has any questions, you may press star one on your telephone keypad to join the queue. Our next question comes from the line of Kevin Dede with H.C. Wainwright. Please proceed with your question.

Kevin Dede (Managing Director and Senior Technology Analyst)

Thank you very much. I thought I'd just take a backseat for someone else, but help me understand the evolution of Banking-as-a-Service, Blockchain-as-a-Service, and Ryvyl's Block offering, and how you're positioning Coyni within the realm?

Ben Errez (Chairman)

Okay. On that strategic question, back to CEO Fredi.

Fredi Nisan (CEO)

Hey, Kevin. So let's start with the Banking-as-a-Service. Banking-as-a-Service in Europe is a license for other financial institutions, the companies, banks to utilize our BaaS, our licensing, to be able to offer their customers different services: SEPA payments, wire payments, FX solution. And now we're going to open up Visa Direct as part of the on-ramp and off-ramp solution. All of that now being implemented and being utilized in a variety of ways. So we see the volume already. We see how the solution can help other banks and companies. Through that process, we see a huge growth and opportunity in that space. So that's one. US Cloud Blockchain Service. We are testing that solution. We're working with Corda directly on a few opportunities that we're trying to understand how we're going to go live with them.

But the service is up and running, but in testing still. This is a big lift, but we are still very excited about the opportunity, and we're going to share more, hopefully, in Q2. That's in regards to the Blockchain-as-a-Service. How Coyni is benefiting from that? Coyni is the payment. It's the software that makes PayFact service and other services available, especially in the U.S. We're still working on deploying Coyni in Europe. We did mention before that we have Coyni just received its licenses in Europe to operate as a payment facilitator. I believe that's the correct license. It allows us to do payments, hold assets in Europe and in the U.S. We are working with our partners. First Data, we have been with First Data to take Coyni as a PayFact to our partners.

So we have a lot on our plate that we're trying to turn on as quick as possible and start to generate revenue as quick as possible. But all of those projects, we're working for a long time. It's heavy on compliance regulation, but we're now there. We arrived at the point of turning everything on. So I hope I answered the question. I didn't miss anything, I hope. But through all of those tools and solutions, that's how we see recovery in the second half of the year.

Kevin Dede (Managing Director and Senior Technology Analyst)

Yeah. Fredi, just to add on that, how should I look at Ryvyl Block versus Ryvyl within the context of Banking-as-a-Service and Coyni's functionality?

Ben Errez (Chairman)

So Ryvyl Block is a separate product. Ryvyl Block was designed, I would say, this way: blockchain for dummies. It's a product for companies that want to go through what we call a digital transformation. They want to get into blockchain infrastructure, allow, for example, a bank or a fintech company to implement blockchain services without going through a year or two of implementation. And they can go live in weeks and not in months or years. So that's kind of the main goal of the Blockchain-as-a-Service, basically, is transformation and getting banks and other financial institutions into that new technology as quick as possible. Coyni, using the same backbone, and Coyni offers the front end of it, is offering the functionality, the ability to process payment, to send payments, the ability to onboard compliance. But the underlying infrastructure is the same block. We're utilizing Corda infrastructure.

Hopefully, that helps a lot.

Kevin Dede (Managing Director and Senior Technology Analyst)

Yeah. Okay. So if I were to summarize it, Ryvyl Block is basically the name that you've given Blockchain-as-a-Service.

Ben Errez (Chairman)

That's correct. It's an internal name. Yes. Ryvyl Block. Correct.

Kevin Dede (Managing Director and Senior Technology Analyst)

Okay. Okay. Apologies. It was just you guys have to your point, Fredi, you have a lot on your plate. And it's hard for a simpleton like me to sort it all out, so I apologize. But I do really appreciate the handholding.

Ben Errez (Chairman)

No problem. Thanks for your continued support, Kevin.

Kevin Dede (Managing Director and Senior Technology Analyst)

Oh, yeah. No, my pleasure. Ben, you've talked a lot about your international expansion, and you focused a lot on Europe. But it just seems to me that there are other maybe not necessarily First World countries, but other countries that might deserve or might offer a similar opportunity that some of the Eastern Europeans want to offer, such as maybe South Africa or Nigeria, maybe even Egypt. How are you looking sort of beyond Europe and expanding your international opportunity?

Ben Errez (Chairman)

Yeah. So that's a good question and demonstrates that someone is paying attention. So this game is a lot about efficiency of revenue. We have more business that we can onboard in a reasonable time. And what we do now is pick the lowest hanging fruit still. Even though the company is growing year-over-year 80%-100%, and as we issued guidance before on this call, we anticipate overall volume of business to grow from the $3 billion range to the $5 billion range. We're still in pursuit of the most efficient revenue that we can take. American Samoa was an interesting case study for us where we entered the market and now control the majority of transactions supporting that GDP in that nation. And we're very happy about that case study. It's proving a point.

However, looking at the quality of revenues that we currently accumulate in the European market just tells us that this is where we need to be picking up speed for the moment. Obviously, at the end of the day, we'll go where business is. However, we'll first play to our strength. And then, even though we may be leaving some money on the table, but we have to first address the most efficient revenue growth before we look to more exotic markets.

Kevin Dede (Managing Director and Senior Technology Analyst)

This is a great segue, Ben. You mentioned American Samoa. I remember on multiple calls last year, you referenced what you thought would be opportunities for other sort of closed systems, such as that in other potential verticals. I understand, obviously, there's a lot on your plate, and you're looking for the low-hanging fruit. It totally makes a ton of sense. I get it. I'm just wondering if you still see that opportunity or if your experience more recently in American Samoa has left you feeling that you want to dedicate less time and resources to exploiting that.

Fredi Nisan (CEO)

So, Kevin, I'll answer that question. This is Min. So American Samoa continued to be a very strategic business opportunity for us in our portfolio. We continue the process. The volume, as we indicated previously, is servicing more than 60,000 people in the States. On the island, as a quick reminder. We have a five-year exclusive partnership for the island. And we are continuing our conversation with our partner there for additional processing needs. We're not in a position to share more details, but we're in a dialogue for that. Now, secondly, for smaller contained ecosystems such as American Samoa, we continue to manage all the major business opportunities in our sales pipeline. As Ben mentioned, we prioritize based on the level of effort involved, alignment with our product roadmap, as well as resource utilization.

We do have adequate major big-ticket opportunities in the pipeline in the near term that we prioritize on rather than pursuing other island business, even though we do have some potentials in the longer term. Over.

Ben Errez (Chairman)

Let me add a couple of words on that. This is Ben again. Remember that because of the technology migration, we experienced a little bit of a drop in the revenues onshore for Q1. I think it's prudent of the company to first backfill that with the most efficient way that we can before venturing out to other opportunities that are more fringe at this point, right? I hope that message is clear.

Kevin Dede (Managing Director and Senior Technology Analyst)

Yeah. Yeah. No, absolutely. But just to be clear, man, I guess I was thinking of closed ecosystems sort of beyond geographic implementation, maybe something more akin to Square's payment processing. And thank you very much for the explanation. I appreciate it. I'll cede the floor at this point. Thank you very much, gentlemen.

Ben Errez (Chairman)

Thanks, Kevin.

Operator (participant)

Thank you. We have reached the end of the question-and-answer session. Now, I'd like to turn the call back to Ben Errez for closing remarks.

Ben Errez (Chairman)

Thanks, Operator. Thank you all for joining us today and for your thoughtful questions and participation. On a personal note, Fredi and I are the two largest shareholders at Ryvyl. We are excited about our 2024 growth plan to diversify revenues and hope to see everyone on our next update for the Q2 results in August. Have a great day, everybody.