Euronet reaffirms 12%-16% earnings growth target for 2025 as digital initiatives accelerate

Earnings Call Insights: Euronet Worldwide (EEFT) Q3 2025

MANAGEMENT VIEW

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Michael Brown, Chairman, CEO & President, stated that Euronet delivered adjusted earnings per share growth of 19% year-over-year and remains on track for "12% to 16% 2025 earnings growth." Brown noted, "our growth was tempered by lighter-than-expected revenue across all 3 segments" and attributed this to global economic uncertainty and immigration policy changes impacting both travel and remittances. Brown emphasized, "we view these challenges as transitory headwinds, not long-term obstacles. The underlying fundamentals of our business remain strong, and we expect these pressures to ease."

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Brown highlighted key strategic developments, including the signing of a major new Dandelion partnership with Citigroup, which "enables Citi's clients to make near instant full value payments into digital wallets across multiple markets." He also discussed the partnership with Fireblocks, describing it as "an important element for our digital asset strategy, enabling interoperability with blockchain systems for faster, more efficient money movement."

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Brown announced plans to launch "our first set of stablecoin enabled use cases in the first quarter of 2026, beginning with treasury settlement, cross-border transfers and consumer cash-out functionality in select markets."

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CFO Rick Weller reported, "We delivered revenue of $1.1 billion, operating income of $195 million, adjusted EBITDA of $245 million and adjusted earnings per share of $3.62." Weller noted, "Revenue growth was below our expectations due to softness in certain areas of the business, which we believe was largely attributable to macroeconomic and policy decisions surrounding immigration around the world."

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Weller emphasized, "our consolidated operating margins expanded by approximately 40 basis points over the prior year quarter."

OUTLOOK

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Brown stated, "we expect to finish the year with year-over-year earnings growth to be generally similar to the third quarter, thereby supporting our confidence of being within the range of 12% to 16% year-over-year earnings growth as we previously provided."

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The company reaffirmed the full-year earnings expectation, with Brown saying, "we are pleased to reaffirm our earnings expectations of 12% to 16% growth for the year."

FINANCIAL RESULTS

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Weller reported revenue of $1.1 billion, operating income of $195 million, adjusted EBITDA of $245 million, and adjusted EPS of $3.62 for the quarter.

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The EFT segment delivered revenue growth of 5%, with operating income and adjusted EBITDA each increasing by 4%. Weller stated, "the business continues to drive growth, led by continued expansion in developing markets such as Morocco, Egypt and the Philippines."

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The merchant services business in Greece saw operating income rise 33% year-over-year.

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epay revenue declined by approximately 5% year-over-year, but operating income increased 4% and adjusted EBITDA rose 2% due to the exit of a high-volume, low-value wholesale mobile top-up product.

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Money Transfer revenue grew 1% year-over-year, while operating income and adjusted EBITDA decreased by 2% and 1%, respectively. Direct-to-consumer digital transactions increased 32%, now representing 16% of total money transfer transactions.

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The company completed a $1 billion convertible bond offering at 0.625% interest, using proceeds to pay down the revolving credit facility, and repurchased approximately $130 million of shares in the quarter.

Q&A

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Vasundhara Govil, KBW: Questioned softness in the EFT segment and travel trends in Europe. Michael Brown responded, "people are being very careful on their -- with their vacation spend...we've seen that more in the ATMs...we actually have seen some of that too in merchant acquiring, but it's just our merchant acquiring, it's kind of growing like a band sheet."

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Govil, KBW: Asked about the Money Transfer segment and immigration impacts. Brown replied, "we've seen that a little choppy...October much stronger than we saw in September...We're 3 weeks in, and we're beating our forecast as we sit."

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Gustavo Gala, Monness, Crespi, Hardt: Inquired about Money Transfer pricing and digital penetration. Weller answered, "on pricing, pretty consistent with what we've seen over time...on average, we had pretty consistent on a year-over-year basis in terms of revenues and gross profits per transaction."

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Mike Grondahl, Northland: Asked about revenue deceleration and segment pressures. Brown said, "our bottom-up forecast for Q4 look like it's turning around the other way."

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Charles Nabhan, Stephens: Probed epay headwinds and Money Transfer trends. Weller confirmed the revenue headwind and attributed mid-single-digit growth to economic pressure, particularly in Asian economies.

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Anthony Cyganovich, Oppenheimer: Asked about immigration impact in other corridors. Weller said, "we've seen some stuff like into like the Bangladesh area...a little lighter transactions going into places, like Turkey."

SENTIMENT ANALYSIS

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Analysts displayed a slightly cautious tone, frequently questioning segment-specific softness, macroeconomic headwinds, and the sustainability of digital growth.

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Management maintained a confident but measured tone in both prepared remarks and Q&A, repeatedly describing challenges as "transitory" and reaffirming full-year guidance. Brown expressed optimism: "we are confident in our strategy, our technology and our ability to deliver sustained growth well into the future."

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Compared to the previous quarter, analyst tone shifted from congratulatory to more probing on near-term pressures, while management's tone remained confident but acknowledged headwinds more explicitly.

QUARTER-OVER-QUARTER COMPARISON

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Guidance language remained consistent, with continued reaffirmation of 12% to 16% earnings growth for 2025.

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Strategic focus broadened with new partnerships (Citigroup, Fireblocks) and advancement of digital asset initiatives, including stablecoin use cases set for 2026.

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Management continued to emphasize resilience and adaptability, but acknowledged a more challenging macro environment impacting revenue growth across all three segments.

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Analysts in the current quarter focused more on segment-specific trends, digital penetration, and macro headwinds, versus the prior quarter's focus on new acquisitions and expansion opportunities.

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Key metrics such as revenue and EPS improved quarter-over-quarter, but segment revenue growth rates decelerated, particularly in epay and Money Transfer.

RISKS AND CONCERNS

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Management cited global economic uncertainty, "policy decisions surrounding immigration," and "softer transaction volumes across certain corridors" as challenges.

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Weller noted, "immigration policies in the U.S. and other countries have pressured the Money Transfer segment," impacting remittance activity and slowing migration inflows.

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Analysts raised concerns about sustained revenue deceleration, the trajectory of digital money transfer growth, and exposure to volatile macroeconomic trends.

FINAL TAKEAWAY

Euronet Worldwide management highlighted the company's ability to deliver double-digit earnings growth even amid global economic and policy headwinds. Strategic progress in digital payments, key partnerships, and upcoming stablecoin initiatives underpin management's confidence in sustaining growth, while operational discipline and capital allocation continue to be emphasized as levers for shareholder value. The reaffirmed guidance of 12% to 16% earnings growth for 2025 anchors management's forward outlook, despite acknowledged near-term volatility in revenue and transaction volumes.

Read the full Earnings Call Transcript [https://seekingalpha.com/symbol/eeft/earnings/transcripts]

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* Euronet Q3 2025 Earnings Preview [https://seekingalpha.com/news/4506670-euronet-q3-2025-earnings-preview]