Introduction
Remitly Global, Inc. (RELY) is a leading provider of digital financial services that transcend borders. The company has carved out a niche for itself in the rapidly evolving cross-border payments industry, consistently delivering exceptional customer experiences and driving sustainable growth.
Founded in 2011 by Matt Oppenheimer, Remitly was inspired by his firsthand experience of the challenges in sending money across borders while living and working in Kenya. Oppenheimer saw an opportunity to provide a better, more transparent, and convenient money transfer service, especially for immigrants sending money to their home countries. The company launched its first remittance corridor between the United States and the Philippines in the same year.
Over the next several years, Remitly steadily expanded its global footprint, adding new send and receive countries. By 2017, the company was processing transactions in over 100 corridors worldwide. This rapid growth was not without its challenges, as Remitly had to navigate a complex regulatory environment, build partnerships with banks and payment processors around the world, and invest heavily in fraud prevention and compliance systems. The company also faced some early missteps, such as its initial foray into the Mexican market, which had to be scaled back due to unexpected operational difficulties.
Despite these obstacles, Remitly persevered and continued to innovate. In 2018, the company launched its mobile app, which quickly became the primary way customers accessed its services. The app provided a streamlined, user-friendly experience that helped drive increased customer adoption and loyalty. Remitly also made strategic acquisitions, such as the 2023 purchase of Rewire, which expanded its global reach and product capabilities.
By the end of 2024, Remitly had grown to serve over 7.8 million quarterly active customers in more than 170 countries, processing over $54 billion in send volume annually. The company had also diversified beyond its core remittance business, adding new products and services to meet the evolving financial needs of its global customer base.
Remitly's Journey of Continuous Innovation
Remitly's success story is one of relentless innovation and a unwavering commitment to its customers. Over the past decade, the company has introduced a suite of cutting-edge features and services designed to simplify cross-border money movement and enhance the overall user experience.
One of Remitly's key differentiators is its mobile-first strategy. The company's intuitive mobile app allows customers to initiate transactions with just a few taps, providing a seamless and efficient money transfer process. This focus on user experience has paid dividends, as evidenced by Remitly's industry-leading customer ratings - 4.9 stars on the iOS App Store and 4.8 stars on the Google Play Store, with over 4 million total reviews.
Remitly's expansion efforts have also been a driving force behind its growth. The company has strategically increased its global coverage, now offering services in over 5,100 corridors and providing access to 5 billion bank accounts and mobile wallets, as well as approximately 470,000 cash pickup locations. By fostering direct partnerships with local payment providers, Remitly has been able to offer fast, reliable, and cost-effective money transfer solutions to its customers worldwide.
Impressive Financial Performance and Operational Efficiency
Remitly's financial performance has been equally impressive, with the company consistently delivering strong revenue growth and improving profitability. In 2024, the company reported revenue of $1.26 billion, representing a 34% year-over-year increase. This robust growth was driven by a 32% increase in active customers and a 38% surge in send volume, showcasing Remitly's ability to attract and retain a loyal customer base.
The company's focus on operational efficiency has also been a key factor in its success. Remitly has leveraged its technology and data-driven insights to optimize its cost structure, with transaction expenses as a percentage of revenue declining from 35% in 2023 to 34% in 2024. Additionally, the company has made significant strides in reducing its customer support and operations expenses, which dropped from 9% of revenue in 2023 to 6.5% in 2024, thanks to its investments in AI-powered virtual assistants and other automation tools.
These efficiency gains, combined with the company's strong revenue growth, have enabled Remitly to deliver impressive profitability metrics. In 2024, the company reported adjusted EBITDA of $135 million, representing an 11% adjusted EBITDA margin. This marked a significant improvement from the prior year, as Remitly continues to demonstrate its ability to scale its business while maintaining disciplined cost management.
For the most recent fiscal year (2024), Remitly reported a net loss of $37 million. However, the company's operating cash flow remained strong at $194.5 million, with free cash flow of $176.8 million. This robust cash generation underscores Remitly's ability to fund its growth initiatives and maintain a strong liquidity position.
In the fourth quarter of 2024, Remitly's revenue reached $351.9 million, representing a 33% year-over-year growth. The company's net loss for the quarter narrowed to $5.7 million, demonstrating progress towards profitability.
Expanding the Addressable Market through Innovation
Remitly's innovation-driven approach extends beyond its core remittance business, as the company actively explores new avenues for growth. One such area is the seafarer market, where Remitly has developed tailored solutions to address the unique financial needs of this customer segment. By providing secure and convenient money transfer services to seafarers, the company is tapping into a previously underserved market and diversifying its revenue streams.
Another promising growth opportunity for Remitly is the micro-business segment. The company's digital-first platform and robust partner network allow it to cater to the cross-border payment needs of small enterprises, helping them expand their global reach and manage their financial operations more efficiently.
Remitly's commitment to innovation is also evident in its continued investment in technology. The company's data-driven approach and AI-powered tools have enabled it to enhance its risk management capabilities, improve customer experience, and unlock new use cases. As Remitly continues to invest in its technological infrastructure, it is well-positioned to capitalize on the evolving fintech landscape and solidify its position as a market leader.
Navigating Regulatory Challenges and Macroeconomic Headwinds
While Remitly's growth trajectory has been impressive, the company is not immune to the challenges that come with operating in the highly regulated financial services industry. The company must navigate a complex web of compliance requirements, including anti-money laundering (AML) regulations, know-your-customer (KYC) policies, and various licensing and registration obligations across the jurisdictions in which it operates.
Remitly has demonstrated its ability to proactively address these regulatory hurdles, investing in robust compliance systems and maintaining strong relationships with local authorities. The company's global footprint and diversified customer base also help mitigate the impact of any localized regulatory changes or geopolitical tensions.
Moreover, Remitly's business model has proven to be resilient in the face of macroeconomic headwinds. The company's focus on serving the cross-border payment needs of individuals and small businesses has enabled it to weather economic cycles, as the demand for remittance services tends to be less discretionary in nature.
Looking Ahead: Continued Growth and Profitability
As Remitly looks to the future, the company remains focused on executing its strategic vision of transforming lives with trusted financial services that transcend borders. With a strong financial foundation, a proven track record of innovation, and a relentless customer-centric approach, Remitly is well-positioned to capitalize on the vast opportunities in the global cross-border payments market.
In 2025, the company expects to deliver its first $1 billion in revenue less transaction expenses (RLTE) and its first full year of GAAP net income profitability. This milestone achievement underscores Remitly's ability to drive sustainable growth while maintaining disciplined cost management and a commitment to profitability.
Furthermore, Remitly's robust product pipeline and its expansion into adjacent customer segments, such as seafarers and micro-businesses, suggest that the company's growth story is far from over. As it continues to leverage its technological capabilities, global reach, and customer-first mindset, Remitly is poised to solidify its position as a leading player in the dynamic cross-border payments industry.
Financial Outlook and Guidance
Remitly's strong performance in 2024 has set the stage for continued growth in 2025. The company exceeded its own high expectations in Q4 2024, with record revenue and adjusted EBITDA exceeding $40 million for the second consecutive quarter. For the full year 2024, Remitly's revenue of $1.26 billion and adjusted EBITDA of $135 million surpassed the midpoint of their initial guidance by more than $25 million.
Looking ahead to 2025, Remitly has provided robust guidance that reflects its confidence in its growth trajectory and improving profitability. For Q1 2025, the company expects revenue between $345 million and $348 million, representing 28% to 29% growth. For the full year 2025, Remitly anticipates revenue between $1.565 billion and $1.58 billion, reflecting a growth rate of 24% to 25%.
In terms of profitability, Remitly expects Q1 2025 adjusted EBITDA between $36 million and $40 million. For the full year 2025, the company projects adjusted EBITDA between $180 million and $200 million, representing an adjusted EBITDA margin range of 12% to 13%. Importantly, Remitly expects to generate positive GAAP net income starting in the third quarter of 2025 and for the full year 2025, marking a significant milestone in the company's financial performance.
It's worth noting that this guidance does not assume any large macroeconomic, geopolitical, or regulatory changes, underscoring Remitly's confidence in its core business model and growth strategies.
Market Opportunity and Industry Trends
Remitly operates in a vast and growing market. The consumer-to-consumer cross-border payments market is estimated to be approximately $2 trillion and is expected to reach $3.1 trillion by 2032, growing at a compound annual growth rate (CAGR) of approximately 6%. This substantial market opportunity provides ample room for Remitly to continue its expansion and capture market share.
The company's focus on key corridors has been a significant driver of its success. The majority of Remitly's revenue is generated from remittances being sent from the United States and Canada to India, Mexico, and the Philippines. These three countries represented approximately 49% of Remitly's revenue in 2024. As Remitly continues to expand its global footprint and diversify its corridor mix, it is well-positioned to capitalize on emerging trends in cross-border payments and tap into new growth opportunities.
Operational Efficiency and Global Expansion
Remitly's operational efficiency has been a key factor in its success. The company has made significant investments in its technology infrastructure to introduce new and innovative products, add features to current offerings, enhance the customer and recipient experience, grow its payment and disbursement network, and invest in its risk and security infrastructure. These investments are expected to contribute to Remitly's long-term growth, despite potentially impacting short-term profitability.
The company's global expansion strategy has been equally impressive. Remitly's services are now available in over 170 countries, providing access to 5 billion bank accounts and mobile wallets, as well as approximately 470,000 cash pickup locations. This extensive global footprint not only enhances Remitly's value proposition to customers but also helps diversify its revenue streams and mitigate risks associated with overreliance on specific markets.
Strong Liquidity Position
Remitly maintains a strong liquidity position, which provides financial flexibility and supports its growth initiatives. As of December 31, 2024, the company had $368.1 million in cash and cash equivalents, along with $277.3 million in unused borrowing capacity under its $325 million revolving credit facility. This robust liquidity position is further underscored by Remitly's healthy current ratio and quick ratio, both standing at 2.73.
The company's debt-to-equity ratio of 0.024 indicates a conservative approach to leverage, which helps maintain financial stability and provides room for potential future borrowing if needed for strategic investments or acquisitions.
Conclusion
Remitly Global, Inc. (RELY) has emerged as a true innovator in the cross-border payments space, consistently delivering exceptional customer experiences and driving sustainable growth. The company's digital-first approach, coupled with its focus on transparency, reliability, and personalization, has allowed it to disrupt the traditional remittance industry and establish itself as a trusted partner for individuals and businesses alike.
With its impressive financial performance, operational efficiency, and a robust pipeline of innovative products and services, Remitly is well-positioned to capitalize on the vast opportunities in the global cross-border payments market. The company's strong guidance for 2025, including expectations of positive GAAP net income, demonstrates its confidence in its growth trajectory and improving profitability.
As Remitly continues to execute on its strategic vision, expand its global footprint, and deepen relationships with its customers, investors can look forward to the company's continued growth and progress towards sustainable profitability in the years to come. With a vast addressable market, a strong liquidity position, and a proven track record of innovation, Remitly is poised to further solidify its position as a leading player in the dynamic and evolving cross-border payments industry.