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Investing.com -- Wex Inc. (NYSE:WEX) shares surged 6.5% after the global commerce platform reported second-quarter adjusted earnings that exceeded analyst expectations and raised its full-year guidance, signaling confidence in its growth trajectory despite a slight revenue decline.
The company reported second-quarter adjusted earnings of $3.95 per share, significantly beating the analyst estimate of $3.71. Revenue came in at $659.6 million, topping the consensus estimate of $648.87 million, though representing a 2% decrease from $673.5 million in the same period last year. The revenue decline included a $15.9 million unfavorable impact from fuel prices and spreads.
"We delivered stronger financial results than anticipated in the second quarter with adjusted EPS exceeding guidance and revenue coming in at the top end of our guidance," said Melissa Smith, WEX’s Chair, Chief Executive Officer, and President. "Our ability to win top-tier customers underscores the compelling value of our solutions."
For the third quarter, Wex forecasts revenue between $669 million and $689 million, above the consensus of $665 million, and adjusted earnings of $4.30 to $4.50 per share, exceeding analyst expectations of $4.14. The company also raised its full-year 2025 outlook, now projecting revenue of $2.61 billion to $2.65 billion and adjusted earnings of $15.37 to $15.77 per share, both above consensus estimates.
The company’s Benefits segment showed strength with a 6% growth in SaaS accounts to 21.2 million compared to the second quarter of 2024, while average HSA custodial cash assets increased 11% to $4.7 billion.
"Adjusted earnings per share exceeded expectations due to a benefit from higher fuel prices and incremental benefits from tightly managing our cost structure," said Jagtar Narula, WEX’s Chief Financial Officer. "We are also encouraged by the positive returns we’re seeing from our investments in sales and marketing this year."
The company maintained strong cash flow with $264.6 million in operating cash flow for the quarter and adjusted free cash flow of $194.3 million.
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