Revenues at UK fintech Wise rose 50 per cent in the past quarter, as customers brought forward money transfers amid fears of greater volatility later in the year.
The volume of money transferred by the company increased to £24.4bn in the three months to June 30, from £16.4bn in the same period last year. Revenues increased about 50 per cent year on year to £186mn.
The payments company said it was watching for signs of the potential effects of rising costs for both personal and business customers on profits, but that it was not overly reliant on disposable income such as travel and had a wide range of customers.
“If you look at remittance data, you will see a slowdown, even a dip in the last recession,” said chief financial officer Matt Briers on an analyst call. “We haven’t been through one of these cycles, so we’re rightly cautious, but it doesn’t feel like we’re over-indexed to any swings in GDP.”
Rising inflation and fears of further currency volatility had led users to move higher volumes of money in the past three months, rather than wait until later in the year, said Briers. Customers were moving higher volumes than the same period in the previous year, he added.
He added that if the level of foreign exchange risk increased, the company could face pressure to stop lowering prices or even increase them.
Shares in Wise rose 15 per cent in morning trading on Tuesday, following the strong results, although are still down 47 per cent in the year to date.
The group reported last month that rising costs from new staff and the expense of listing had weighed on its earnings in the year to March 31 — its first as a listed company.
“The Q1 2023 numbers point to a very strong start to the year with volumes and revenue ahead of our current estimates,” said analysts at Numis.
Wise previously said it expected revenue growth of 30 to 35 per cent for the 2023 financial year and more than 20 per cent in the medium term.
The fintech, founded in 2010, was one of the few standout tech companies to list in the London market in recent years.
However, it is under scrutiny after it revealed in June that the UK’s Financial Conduct Authority had launched an investigation into chief executive and co-founder Kristo Käärmann over deliberately defaulting on tax payments.
