Flywire at Wolfe Research FinTech Forum: Strategic Growth Amid Challenges

On Tuesday, 11 March 2025, Flywire Corp (NASDAQ: FLYW) presented at the Wolfe Research FinTech Forum, providing an insightful overview of its strategic positioning amidst current market challenges. Despite facing macroeconomic headwinds, the company reported a robust 24% revenue growth. However, visa restrictions in Canada and Australia pose short-term challenges. Flywire is focusing on integrating recent acquisitions and expanding its business beyond education into sectors like travel and healthcare.

Key Takeaways

• Flywire achieved a 24% year-over-year revenue growth and expanded margins for the second year.
• Visa restrictions in Canada and Australia could negatively impact growth, with expectations of a 30% decline in these markets.
• The travel segment showed significant growth, becoming the second-largest vertical with a 50% increase.
• Flywire is prioritizing capital allocation through M&A and share buybacks to drive long-term shareholder value.

Financial Results

• Revenue increased by 24% year-over-year.
• Margins expanded by over 500 basis points for the second consecutive year.
• Education outside the U.S. contributes over 50% of the business, with growth in the mid-20s.
• The U.S. education segment accounts for over 20% of the business, growing by 13% last year.
• Travel now comprises 13% of the business, showing a 50% growth rate year-over-year.
• The healthcare segment makes up about 6% of the business.
• The B2B segment, though the smallest at 3%, is growing at approximately 70%.

Operational Updates

• Flywire added a record number of clients, with significant contributions from the travel and education teams.
• The Certify acquisition enhances travel vertical capabilities, adding $3 billion in payments volume.
• The B2B segment is seen as an innovation lab, offering services like automating accounts receivable.
• A major hospital system client is expected to boost growth in the healthcare segment, with a deal worth eight figures on a $30 million basis.

Future Outlook

• Flywire aims to drive long-term shareholder value through organic investment, M&A, and buybacks.
• The company plans to remain active in the market regarding buybacks, leveraging strong liquidity and cash flows.
• Single-digit growth is expected in the healthcare segment, with significant ramp-up anticipated from the new marquee client in the second half of the year.

Conclusion

For a detailed account of Flywire’s strategic plans and financial performance, refer to the full transcript provided below.

Full transcript - Wolfe Research FinTech Forum:

Darren, Analyst, Wolfe: Cover payments, processors, and IT services here at Wolfe. Really happy to have Flywire with us this morning and, Cosman, the CFO of the company, with us as well. You know, Flywire is a name that we did their we worked on their IPO, when was that again, a couple of years ago, a few years ago already at this point, in 2021. And, I’ll say this again, I’ve said this before, but of all the companies we did did IPOs for, it continues to be the name that stands out as some of the best customer diligence calls we did with almost any IPO we worked on during that pretty crazy time frame of new companies coming public. Just as a testament to, I think, the offering you guys gave, especially the universities, but also the travel area, the health care area.

So it’s always been a very well received story. Although, you know, there’s been a couple of speed bumps lately on the, on some things that might be a little bit out of your control. I think it’d probably best maybe just start off and give us a sense. You just reported fourth quarter, a lot to talk about, obviously. So, Kajsa, maybe just start off with some of the key takeaways from the last print.

Maybe just what’s on your mind coming out of the quarter, what you want to make sure investors recognize, and we’ll go from there.

Kajsa, CFO, Flywire: Awesome. Well, thanks, Darren, for having me here. Appreciate it. Great event. Love to participate every year.

And look, I think it’s an understatement to say that times are volatile right now, and we definitely saw that last year. But despite quite a bit of macro pressure even for us last year, I would say I think the main takeaway is that we still we’re quite resilient, grew the top line at 24% revenue. Margins expanded for the second year in a row above 500 bps, added record number of clients and retained many of the existing clients. So look, the team was very resilient. And that really is what me joining the company sort of last year was great to see the culture and how sort of the teams rallied together through that.

Look, in terms of some of the maybe I’ll talk through the highlights and some of the headwinds that we faced. But as far as highlights, really strong growth. Travel and B2B continue to be big drivers of growth, big drivers of client acquisition. We’re continuing to acquire new clients there and grow the existing base. So strong growth, travel now being our second largest vertical as of last year.

So great to see that performance. And even within education, we continue to see strong growth in markets, even markets pressured by Visa, student Visa issues. So EMEA, especially The U. K, very strong growth, sort of multiples, almost above kind of our average growth. So really strong growth there.

Asia and other parts of the business also grew quite well. And so kind of across the board, really strong growth and strong client retention. Like the headwinds, as we exited Q4, I mean, one thing that we learned through last year, Canada was our biggest headwind. And we sort of, I must say, chased it down because sometimes what we learned is there’s government headlines and sometimes the headlines react quickly, other times headlines react slow. And what we saw in Canada and it actually got worse as we exited the year was that the demand destruction.

So if you’re a country that’s been somewhat welcoming to immigrants and you suddenly change your tune and you especially, they put, student permit caps in place early in the year, that actually was not really the main issue. The issue was that this sort of negative rhetoric around sort of welcoming students in, we saw that sort of what we call demand destruction happen. And it sort of got almost worse throughout the year, worse exiting into December and even into this year. So that what we learned from that was that, hey, we need to just kind of look at our data. You know, a lot of the universities and others locally felt that, you know, they’ll be able to fill the seats and, hopefully, be able to manage that.

But clearly, we saw even though the actual cap the actual drop in visas was around 45%, we actually saw a 35% decline. So a little bit less, actually. So even in Canada, we’re still adding clients and kind of holding on to the existing clients because obviously our software and the capabilities that we bring actually resonate especially when times are tough because that’s when you want to put in software that makes you more efficient. So it actually solves the issue. And we can talk about that in the travel context.

But look, exiting that, we saw Canada was worse. So that was one of the reasons we’re behind in Q4 in addition to FX. But also, we saw we continue to see pressures in The U. S. Some visas in The U.

S. Were down 10% last year. Despite that, we still grew. As you saw, U. S.

Education was up 13%. That’s about 23% of our business. But, yeah, I mean, it’s certainly not a friendly environment for international students. So we’re we’re we think we’re more resilient coming out of that, I would say. And that’s was a good sort of good practice ground for coming out of that and going into this year.

Darren, Analyst, Wolfe: Just before we go into the guidance and the net revenue, just level set us for a minute. I mean, your business has generally transitioned from what was a vast majority education, right, in universities, and it’s really travel and healthcare. So just for the audience, for those that are a little less familiar, just remind us again the breakdown, if you don’t mind. Yeah. The four effectively, four or five, you know, the key areas.

Kajsa, CFO, Flywire: Yeah. So education, I would say, outside The U. S, education is about 50, just over 50% of our business. And that’s actually growing quite healthy, well above 20 mid-20s kind of growth rate. U.

S. Is about 20% just over 20% of our business. U. S. Education is that.

And then now we have our travel business, which is 13%, which was up 50% last year. So a huge driver of growth, great success story. And we also have our healthcare business and B2B. So healthcare has been with us for a while. We’ve been going through a lot of changes and improvements in that.

And that’s around 6% of our business. And then B2B is our sort of newest vertical. Smallest is around 3% but growing at almost 70%. So a lot of very high growth kind of opportunity. So I and we’ll talk about it more, but I really think of the capabilities that we bring as solving an operational complexity.

And I think I know we’re sometimes perceived as an education kind of focus, but I I think of us as solving an actual operational complexity with large payments tied into it. Right.

Darren, Analyst, Wolfe: So when you put those all of those segments and all those great growth rates together, obviously, historically, really up until almost last year, right, you were growing 25% plus top line for for some years now. And as I mentioned earlier, there’s a lot of land and expand opportunity that we’ve seen in your business model. This year, your guidance was really more of a mid teens type level, right? Low to mid teens, I should say. I think it was 11% to 14%.

Kajsa, CFO, Flywire: Yeah.

Darren, Analyst, Wolfe: For the year ahead of us, 25% that you just gave. And it’s a bit lower than I think some investors even initially thought, but some of that was capturing some of this out of your control restrictions on visas in Canada and Australia.

Kajsa, CFO, Flywire: Right.

Darren, Analyst, Wolfe: So if you don’t mind, just take a step back. We went from that mid 20% top line. This year, we’re we’re calling for 11 to 14. Just again, as much as some might understand that, if you could just help provide a little more detail on the underlying assumptions built into the guide for this year and we’ll go from there.

Kajsa, CFO, Flywire: Yes. Very important, I think, to understand the components. And, like, I think for the year so for the year, we guided 10% to 14% for Q1, sort of 11% to 14%. So very similar, I would say, Q1 and full year, I think dynamics. So that’s one thing to keep in mind is that we’ve sort of assumed relatively stable growth throughout the year.

There’s no sort of hockey stick or anything. As you look throughout the year, it’s more sort of even between first half, second half. But and partially, it’s because as we’ve learned from last year, we just discussed, we’re trying to be more data dependent, trying to be more balanced in the approach of inheriting and looking at the the guidance last year, like I said, chasing Canada down all year long. Yep. Felt that, you know, let’s be sort of transparent and balanced about how we look at that.

So sort of three components to the guide. So first, Canada and Australia. So those make up around 15% of our business, about equally between the two of them last year. We’ve assumed both of those are down 30%. Now let me just unpack that.

So in Canada, that demand destruction as we entered into January continued to see negative trends. And that was I think surprising to everyone, because I think most people assumed, well, you’ve dropped once, how many times can you? So Q1 still seeing that. So in addition to the demand destruction, they’ve also implement they basically canceled the program that required students to pay upfront their tuition with their visa. So now we’re seeing a bit of a timing component in our quarter.

So that is a portion of that 30% decline. It’s just a little bit more than half is just that sort of the what we call the SDS program cancellation, which is, again, surprising that the government would do that given that the education sector is under pressure, but nevertheless saw that and saw the data. So again, being data kind of driven in our approach, we assume 30% decline there. In Australia, a bit different. The government and the education sector were sort of almost it looked like all through early part of Q4, pretty balanced and had agreed to sort of not put caps in place.

And then suddenly, the government just, you know, put soft caps in place that impacted pretty much every part of the education sector, large universities as well as smaller. We have some we have an insurance product there. We have admissions kind of product. So those are all going to be impacted. So again, learning from Canada, while not seeing Australia down at that level at this point, we’ve assumed 30% decline, again, seeing that.

So those two alone, if you just looked, that’s like sort of five or six points of growth versus what I think most of us were thinking kind of through Q4.

Darren, Analyst, Wolfe: That alone gets you from what?

Kajsa, CFO, Flywire: That alone is sort of, that alone will sort of get you. So we keep talking about the fact that we don’t need these headwinds to turn into tailwinds. We just need sort of a stable environment. Then you could be sort of at a very different kind of growth profile. And then I’d say US and healthcare are the next two.

So I think US in particular, what we saw, as I said, some pressure from visas entering into January. New administration in place, hard for us to really pin down kind of what’s coming next from that. So again, felt prudent to so last year, visas were down 10% in The U. S. We were up 13%.

So still expanding. U. S. Domestic is an area of growth and investment for us, continuing to cross sell. And so we’ve assumed sort of single digit growth in The U.

S. Because I think we’re going to see more uncertainty. Again, I realize the understatement of the day around what’s happening. And we’ll wait to see how the new administration and how visas play out. But felt prudent to sort of say that we’ve said and be transparent about it as far as that assumption.

Okay. Healthcare, good to see that we’ll talk maybe a bit about the fact they’ve signed a really big client, eight figure client for a $3,000,000 business is a significant win. But it’s more second half weighted. So again, kind of assumed not a ton of growth upfront and assuming that it starts to pick up, but again didn’t want to bake a lot of that in. We’re going to be again, data dependent, watch that ramp.

And then the rest of the business, if you sort of strip those out, you end up with basically everything else is growing well into the 20s and some things obviously even higher than that. So travel B2B will continue to be much faster growing. But again, we’ve tried it we’ve assumed kind of a balanced growth rate because overall if I step back and think of the guidance as more trying to be balanced, trying to be transparent, and trying to be sort of data driven. And just kind of unpack as much as we can and provide updates as we see it. Because you’re sort of you’re in an environment where when it’s a macro driven factor, if you’re trying to forecast like I am on a day to day basis, you’re having to look at a number of different factors.

So trying to update everyone as often as we can around that.

Darren, Analyst, Wolfe: So the all right. So you already incorporated the 30% decrease in Australia and Canada. And then The US is a little bit more of an uncertain, a bit of a question mark. What is that typically would have grown 20% plus if I remember correctly. Right?

Kajsa, CFO, Flywire: So last year was 13%. So we’ve assumed sort of single digits this year in The U. S. Education business.

Darren, Analyst, Wolfe: So you’re already incorporating a further deceleration from the teens down

Kajsa, CFO, Flywire: to the Yeah. From that 13%. Yeah. Because we’re assuming visas will continue to be a pressure, on, you know, sort of across the business.

Darren, Analyst, Wolfe: Right. Okay. When we think about the what is in your control, I mean, adding customers, obviously, has been something that you’ve still done pretty well. I mean, I think you added around 800 total customers or clients across your segments last, if I remember correctly, last year, surpassing the 4,500 mark globally, right? Yeah.

Just help us understand the client acquisition strategy and how it’s evolved. And because again, that’s still a pretty healthy number when you think of the underlying percentage growth rate of new customers adding on

Kajsa, CFO, Flywire: Yeah.

Darren, Analyst, Wolfe: You know, almost 20%. And so what’s been the strategy around that? Where are you in that? What’s is it mostly education? Is it travel?

What categories is it also?

Kajsa, CFO, Flywire: Yeah. So, you know, record number of clients. We both our education and travel teams are being our biggest kind of contributors. You know, they it’s actually as a good healthy competition internally. One quarter was education, another quarter was travel.

But net net, I think where we ended the year was travel actually added most of the clients. So the way we look at it is travel is now sort of second largest vertical, adding the most number of clients. And from a sort of approach there has just been I mean travel has a great machine, if you will, from all the way from marketing, down to kind of converting that into an actual sale and signing. And also now we’ve got a strong referral sort of because the name is out. Sort of we’re at the size where you know, you have existing clients that say, hey, if you’ve traveled to this area, you know, maybe you should use these guys.

You know, they do a great job, you know, simplifying kind of your your back end kind of operation. So seeing, you know, that machine working really well on the travel side in education, we continue to add. Certainly in EMEA, you’ve seen kind of some of the EMEA and Asia numbers, you know, seeing a lot of growth there. Still adding even in countries like Canada. So still adding even in the areas where because again, we’re solving for exactly the problem they’re having, which is, you know, if you’re under pressure and you’re trying to figure out how to be more efficient, you know, we’re there to help.

The other thing that we’re seeing is, you know, there’s this kind of emerging trend with international students, you know, staying in areas where they are. So some emerging market growth. And so we continue adding in those areas or Continental Europe. So as students are maybe choosing not to go to some of the normal four kind of large destinations, maybe they’re go we’re seeing sort of countries like France and others doing well. So continuing to add there and strengthening kind of our diversity sort of outside of the core four countries.

So adding a lot of clients in those areas too. Cool. Whereas healthcare, you know, big big new client, not Yeah.

Darren, Analyst, Wolfe: The hospital.

Kajsa, CFO, Flywire: You know, you don’t need to add a lot of those to to make a big difference. So that’s a kind of a different dynamic on that side.

Darren, Analyst, Wolfe: So from your perspective, I mean, the trend line on adding customers continues to be similar to what you’ve seen?

Kajsa, CFO, Flywire: Yeah. Yeah. Certainly. Alright. That’s good to hear.

Darren, Analyst, Wolfe: And then just the NRR trends, I mean, again, going back to the 20 typically 120% NRR levels of the business. I know without Canada, it still remained at that level, I think, right? Yeah. And I guess The U. S.

As well is having a bit of an impact now. We’re going to see how things go going forward. But if you could just talk about any support potential growth opportunities you’re seeing? And then if your expectation I know your expectation for NRR this year is to tick down again. Is that all just Canada or anything else going on in the business that’s impacting that as well?

Kajsa, CFO, Flywire: Yes. Look, I think underneath NRR, we’ve always had a very sort of stable kind of growth algorithm that we’ve talked about for a while. And part of that was growth in student, just in overall students, international students. And if you look at Open Doors data kind of growth rate, that’s been sort of a plus low single digit to mid single digit growth rate over many years, twenty, thirty years. That’s kind of the trend.

In addition to that, there’s tuition growth. And what I think has supported for us on top of that is the fact, as you said, if you do channel checks, our clients love us. That’s one of the things that I love about the business is you talk to any of our clients, certainly in education. They love us, they love the product. And so we have great 95% plus client retention, which plays into that.

And then you have a ton of upsells and expansions that happen. You heard us talk about land and expand. You start with one part of the university, you expand another part. So those are some of the things that have created that 120 plus, kind of consistent view. But look, if your if the main thing that happens is that Visa number suddenly goes negative, obviously, that creates a large negative.

None of the other things sort of change. We still have clients that love us. We’re still continuing to expand. We’re still continuing to grow. But you have this dynamic of a big negative.

So in Canada and Australia is where you’re seeing that the most dramatic. What we’ve assumed for this year is technically across all four of our markets, we’re going to see Visa pressure. Obviously, quite a bit more are seemed in Australia and Canada, But even in The U. S. And U.

K, which last year also saw 10 to sort of low teens kind of visa pressures. So those still grew last year. But again, we’re assuming that that continues this year. So NRR, you know, but, you know, we’ll we’ll again, we’re we’re have to we’re gonna have to see kind of how it plays out, but feel that we’ve, you know, adjusted for some reason.

Darren, Analyst, Wolfe: I was just gonna say, I mean, putting it all together in terms of NRR and the guide you gave and what you assume for visas, like, do you feel as of what you’re seeing today that you’ve captured what you need to capture in the outlook?

Kajsa, CFO, Flywire: Yeah. I mean, look, we guided Q1 with that in mind. We’re in the middle of the quarter. And so we’re kind of, like I said, data dependent looking at kind of where we are, and felt that we’ve again, when you’re in an environment like this, the best thing you can do is look at where things are trending and when things are and try not to sort of get too hopeful or but also not in the other direction sort of take every headline and and run away with it. Right.

Darren, Analyst, Wolfe: Let’s shift to travel, which is a category that’s now, I think, your second largest vertical. It’s done well. I mean, it really has grown from very

Kajsa, CFO, Flywire: from

Darren, Analyst, Wolfe: a pretty small piece of the business when you guys went public, obviously. Yeah. So what’s been so successful? What are you doing there that’s differentiated for travel, for just travel outlets in general? Help us explain understand the business model, and then maybe you can touch on the the recent deal and certify also that I think complements it.

Kajsa, CFO, Flywire: So I think if I go back to the origin story, I think, again, a lot of people think of us as maybe education. But I think the focus for us has always been this intersection of software and payments. So solving a complex operational kind of problem. And really, we looked at poorly digitized kind of verticals. And yes, education fits into that, but so does travel, so does health care.

Think of large payments where it’s not enough just to get the payment in and actually receiving the payment in a foreign, country actually is quite complex, but also tying that into your system of record. So that is, one of the things that were differentiates us is that accounts receivable view of the world and tying it into a system of record. Travel was that for us during COVID. Funny enough, I think we’re we seem to be formed in these, you know, periods of tumultuous times. You know, travel for us was that vertical that we leaned in with those clients during travel, built the business, and they loved us ever since.

And it’s you know, we started out with smaller sort of, you know, call it luxury travel, but it’s really think of it as kind of multi day bespoke travel. So when a group of people goes on a, I don’t know, a heli skiing trip or something or just on a trip and you’re different markets, different countries trying to if you’re a travel operator, you just want to deal with your business. You don’t want to deal with the complexity of receiving those payments in the different currencies, translating them and then booking them into your system of record. And that so that same software that resonated with universities dealing with some of that multiple students receiving wires and checks, that also resonated with travel operators. So that’s where we saw that early kind of win and we saw the same curves that we saw in EDU early on.

We saw that in travel. So for us, it was certified acquisition really was investing in that strength, seeing that growth, seeing the record number of clients through last year and that positive trend. For us, adding that and sort of creating what is going to be almost a quarter of

Darren, Analyst, Wolfe: our

Kajsa, CFO, Flywire: business into next year and growing quite a bit faster than the rest of the business is kind of a natural kind of extension of that.

Darren, Analyst, Wolfe: Just what is Certify? What does it do? What does it add for you guys? Help us understand. I mean, the travel vertical has been growing extremely well without it.

So what does this bring to the table?

Kajsa, CFO, Flywire: Think of it as both expanding and deepening our motes and sort of travel is because we started with those smaller travel operators, certify as sort of accommodations and billing for the largest names in hotels. You can think any sort of name you can think of, they are probably there. They focus primarily on hospitality flows and solving those types of billing kind of issues related to it. But it also it’s a so it’s a different product, but also a different so high end client. So suddenly you have depth of product, breadth of clients that you can bring to the table.

In addition, they are actually quite U. S. Focused. As you can imagine, our existing travel business is more international focused. So as you look at the complement of those together, there’s a few immediate sort of synergies that we looked at.

First, our usual sort of think of the WPM kind of acquisition. Again, that was it feels like a lot like that where you kind of have the software. They were down the payments kind of monetization journey. So there’s about $3,000,000,000 of payments volume that we can monetize. So that’s a sort of a, you know, again, they’ve started down that path.

That’s kind of what we do well. So together, we can do much better there. International, so we’re mostly existing. It’s mostly international. Our our work is just sort of our, you know, Salesforce is international and travel.

So being able for them, being able to tap into that and being able to go to sort of the luxury boutiques, to, you know, if you’re planning a wedding somewhere, you know, outside The US, that that type of stuff, you know, we we can now we have that sales force there. So that’s another $100,000,000 or so of revenue synergies. And they’re looking cross sell to each other, there’s a lot of cross sell of flywire into their kind of the smaller boutiques kind of hotels and vice versa. So lots of opportunity across the board. We think, again, we can sort of more than double that business over the next few years on its own.

And these synergies and again, it’s higher gross margin than our kind of existing travel business. So their gross margins because they’re mostly softer, so it’s about the business is about 70% software, 30% payments. So there’s gross margins are closer to our sort of existing, like, high 60s percent kind of gross margins with very healthy EBITDA margins. Nice.

Darren, Analyst, Wolfe: Just the third, I guess, becoming one of the quickest, been the fastest growing verticals B2B, right? It’s another category that you went into, I think, a little bit really after the IPO timeframe. But where are you on that? And what are you doing in B2B when you think everyone here talks about B2B payments all the time? Help us explain, understand a little more of your differentiation in it, what value you bring to the table, and what what the trajectory is.

Kajsa, CFO, Flywire: Yeah. I mean, so I think every business needs sort of a a core part of the business, some adjacencies that add to the core. And then it needs sort of an innovation lab, if you will, or some part that’s growing kind of new businesses. And for us, B2B, I think of that as kind of our innovation lab. That’s where, to some extent, travel came out of that same idea where we look at different industries that are in that same kind of place that we talked about.

So they’re looking to automate their accounts receivable, their invoicing, their billing, they’re trying to automate through their back office. And they’re trying to do it, these large payments international. And so think of industries like insurance or manufacturing or others where this is starting to look a lot like kind of the issues that we’re trying to solve for. So B2B has been that for us. It’s been that sort of innovation lab, but also in itself a good grower.

Again, more of a receivable kind of view of the business. And that’s where we added the invoice acquisition last year, which is a smaller sort of acquisition, but it’s been a powerful product addition where, again, we’re adding software to our payments capabilities. And we’re seeing a lot of that initial kind of the synergies that we’re hoping there. By the way, invoice some of our travel clients are also asking for that same capability. So there’s synergies kind of again within B2B but also outside B2B.

So continuing to see, good progress there. Again, you know, very kind of multiples growth on a smaller base, but, excited about the opportunity there.

Darren, Analyst, Wolfe: Okay. And then just from a vertical standpoint, wrapping it up with healthcare, which, I guess is your third largest vertical now, but close to travel, right? Obviously, you secured a strong relationship with a hospital, major hospital system. And just hopefully that kick starts strong growth again on an area that used to grow well, it moderated a bit. So just maybe catch us up to that.

What went into, first of all, securing that win? What was the differentiation that allowed you to take that business? And then just how do we think about that segment going forward?

Kajsa, CFO, Flywire: Yes. So as you said, we’ve been transforming both the product, the sales team, and making changes to that business. And now we’ve started, you know, we’ve started to see some stabilization. Getting this client on board, I can tell you, was a full team cross functional, very competitive RFP. But think of this as a hospital system that is a marquee name.

This is the kind of name it’s not just large from a, obviously, you know, 8 figures on a $30,000,000 basis is a sort of a pivot in sort of growth potential, but it’s a marquee name that others will be a it would be a reference client for us. And it kind of changes the profile of the capabilities, but it’s at the same time complementary to existing capabilities that we have in the health care business where think of our health care business as not just solving that operational problem, but if it’s a client or I guess it’s a patient affordability issue when you need to you get this large bill if you’re in an emergency room or surgery center. And the ability to split that payment, book that into the system of record, we work with the largest kind of providers out there and integrate with them directly. That provides a unique capability. And this client will be, I think transformational for that vertical too.

Darren, Analyst, Wolfe: So the overall segment growth, I don’t know what you guys have provided in terms of expectations on it, but

Kajsa, CFO, Flywire: Still sort of, I would say, single digit for now. And so, again, because we’re sort of starting slower as you saw last year sort of flat. So starting from that base. But this client sort of ramps in the second half of the year into next year. So it’s more kind of and again, we’re gonna, learning and providing that visibility into the guidance.

It’s assuming, you know, that we’re we’re seeing that into second half into next year. Okay.

Darren, Analyst, Wolfe: Kazm, let’s just shift to the capital allocation side for a minute. I mean, I think regarding, the certified deal, I think you expect to pay down the entire drawdown by the end of the year, if I’m not mistaken, right?

Kajsa, CFO, Flywire: Yeah. Yeah. That’s right.

Darren, Analyst, Wolfe: I think you also have, what, dollars 100,000,000 authorization for buybacks We still

Kajsa, CFO, Flywire: have that left.

Darren, Analyst, Wolfe: That you announced in August. So just maybe help us understand how you’re prioritizing dollars now going forward, how anything might change from here just given the backdrop of the market we’re in?

Kajsa, CFO, Flywire: Yes. Look, I think our priorities remain sort of organic investment, M and A to some extent, and then buyback. Obviously, on the M and A side, I think our focus will be on integrating, obviously, Certify working on that. That’s going to be a big focus for us over the next coming months in particular and even Invoice too. So integrating all those acquisitions, I think, for us will be a focus on that side.

And then from a buyback perspective, again, we continue to have very strong liquidity, solid cash flows. Our cash sort of conversion is quite high if you look at our EBITDA margins, which by the way continues to grow. And so we have pretty high cash conversion there. So expect that we’re going to be, especially at these prices, we feel from a value perspective, we’re going to be quite active in the market from a buyback perspective. So we’ll continue to do that.

And if

Darren, Analyst, Wolfe: we look ahead by the end of twenty twenty five and you’re sitting here or even in the, let’s call it, next year, March of next year, sitting here next conference, what do you want to have seen throughout this year to succeed, to call the year a success, really? What is your main milestones you hope to achieve?

Kajsa, CFO, Flywire: Look, I mean, I think even whether it’s capital allocation or sort of the everything that we’re going through right now, the portfolio review and optimization is really with the goal in mind to drive long term shareholder value. And I think the same as we started down the path last year, for me, sort of success is we emerge stronger. I think as a single kind of phrase is we emerge stronger out of this. I don’t think easy times are sort of what makes you stronger, I think, is tough times where you kind of show who is resilient. And I think we’ve shown that resilience already last year where we exceeded our margins and expectations there.

And I feel like emerging out of this even stronger. And like I said, we’re going to focus on what we can control. That’s the other thing. I think it’s hard to pay attention to the headlines and look at all that. But at the end of the day, focus on what you can control, drive long term shareholder value and emerge stronger out of this is what I expect from us.

Yes. Okay.

Darren, Analyst, Wolfe: All right, guys. I think we’re about out of time now anyway, but thank you so much for joining us. I appreciate it. Guys, the next up, we have the CFO of Remitley here in the Homes Room. We have the interim CEO and CFO of Marketa and the Adams Room starting at 09:20.

So thanks very much, everybody.

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