Wise's financial strategy: CTO Harsh Sinha and CFO Kingsley Kemish discuss FY 2024 financial results
Wise Reports Strong Growth and Improved Performance in FY 2024
In a recent financial update, Wise, the digital money transfer service, has revealed impressive growth and performance figures for the fiscal year 2024. Despite no new information about share prices, the company has made significant strides in various aspects of its operations.
The Wise Platform has seen growth in FY 2024, though specific details remain undisclosed. The company's underlying adjusted EBITDA margin for the same period reached an impressive 28%, reflecting operational efficiency.
Wise now operates in over 160 countries and across 40+ currencies, expanding its global footprint. The active customer count has also increased, though the exact percentage remains unspecified. Cross-border revenue, which constituted 69% of the total revenue, amounted to £795.2m, a 17% increase. Non-cross-border revenue, accounting for 31% of the total, did not reveal any new information about its distribution across the two segments.
One of Wise's key strategies is its transparent, low-cost fee structure. This approach, which aims to provide minimal complexity and access to mid-market exchange rates without hidden charges, has been instrumental in driving growth. Over the past five years, Wise has reduced costs by about 25%, continually innovating to lower transaction fees and increase speed across its cross-border payments platform.
Wise offers preferential rates for high-volume business customers while avoiding complex tiered pricing models. The Wise Business account, a service that supports holding and exchanging over 40 currencies, sending payments to 140+ countries at speed and low cost, has been a significant contributor to the company's growth.
This pricing and cost-reduction strategy has led to significant growth and improved performance. The company has seen active customers increase 2.1x and cross-currency revenue increase 2.2x in the last three years. The Wise Account, a full commercial finance platform, contributed 38% of total revenue in FY2025, showcasing Wise’s ability to drive revenue while controlling costs.
The company has also seen an increase in free cash flow per share in 2024, reflecting operating leverage gains driven by higher customer assets and revenue diversification. However, share prices dropped more than 16% due to the company's price cuts and revised outlook.
In response to its price cuts, Wise is exploring cost reduction opportunities. The company has acquired a significant number of SME customers in FY 2024, indicating a shift towards serving businesses. Card and other revenue have climbed 6.7x in the last three years, suggesting a growing diversification of income streams.
In summary, Wise's transparent, low-fee, no-hidden-cost pricing strategy combined with operational cost efficiencies is fueling strong growth, user base expansion, higher revenue per user, and evolving product offerings, positioning it to become a major global financial institution. The company's focus on innovation and customer-centric approach continues to set it apart in the competitive financial services industry.
Investing in Wise's business in the fiscal year 2024 could have yielded significant returns, as its strong growth and improved performance were attributable to a transparent, low-cost fee structure and operational efficiency, leading to increased active customers, cross-currency revenue, and free cash flow per share. Furthermore, the company's expansion into business customer services and diversification of income streams indicate promising opportunities for future investing in the finance sector.
