Wise sees profits soar amid customer boost and rising interest rates
The group reported a pre-tax profits of £146.5 million for the year to March 31, up from £43.9 million the previous year.
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.Money transfer firm Wise has unveiled soaring annual profits thanks to surging active customers and as higher interest rates boosted its income.
Shares in the group jumped by as much as 21% after it reported a 234% rise in pre-tax profits to £146.5 million for the year to March 31, up from £43.9 million the previous year.
Underlying earnings leapt 97% higher to £238.6 million.
It notched up a 34% jump in active customers to 10 million after attracting 4.5 million new customers, and saw them move £105 billion across borders internationally, up 37% year on year.
The group said a 73% rise in income to £964.2 million was boosted by higher interest rates as central banks worldwide pushed the button on increases to try and curb sky-high inflation.
Wise said its net interest income raced higher to £118.1 million, against a loss of £2.8 million the previous year.
We expect this customer growth to lead our growth in the future
The group predicted a further rise in active customers over the year ahead, which it said will help provide a further fillip, but warned that income growth will slow.
Analysts said the guidance was better than expected, with Wise also forecasting its margins to rise by 20% or more in the medium term, which helped send shares rocketing.
Co-founder and chief executive Kristo Kaarmann cheered an “exceptional set of financials” thanks to “continued momentum in customer growth combined with some specific tailwinds from interest”.
“We expect this customer growth to lead our growth in the future,” he added.
Outgoing chief financial officer Matt Briers said income growth will ease back to between 28% and 33% after the “unusual trends” seen in the last financial year.
He said: “As we pass through 2023-2024, it will be important to keep in view that we will be lapping some unusual trends from 2022-2023.
“This includes an exceptional level of volume growth in the first half of 2022-2023 and strong interest income growth in the second half.”
The results come as the group is searching for a replacement for Mr Briers after he recently announced plans to step down by next March to focus on recovering from a bike accident last year.
Mr Briers, who has has held the role for nearly eight years, returned to work last May after the accident in February 2022.
He said he now wants to concentrate on making a “full recovery”.
Mr Kaarman is also preparing to take a three-month sabbatical to spend time with his family and look after his newborn son.
He will take the leave from September to December this year, during which Wise’s chief technology officer, Harsh Sinha, will step into his shoes.