Wise Q3 2025 Report

Wise Q3 2025 Earnings Report

Wise delivered its results for Q3 2025 but the H2 will be delivered with Q4. Which means we don’t have the whole picture on the company’s performance like we would for an American Company. But we can dive into the numbers the company did provide to see if continues to make sense to be invested in.

Financial Performance Highlights

Cross Boarder Revenue: 212.9 Million, 3% gain YoY, with CCY 6%

Card Revenue: 97.8 Million, 39% gain YoY, with CCY 42%

Interest Income: 38.8 Million, 24% gain YoY, w/ CCY 27%

Underlying Income: 349.5 Million, 13% gain YoY, w/ CCY 17%

Cross Boarder Volume: 37.8 Billion, 24% gain YoY, w/ CCY 27%

Customer Balances: 16.2 Billion, 26% gain YoY

CCY: Constant Currency

Overlooked?:

The 13% YoY growth misleading to growth investors because it fails to consider 2 major factors. Wise is continuing to cut its price as it drives price as low as possible by lowering their price 16.5% YoY. Which helps conceal that the rate its transferring money is growing by 27% CCY. It also has its highest gross margin its Card revenue growing at 42% CCY which is nearly 1/3 of its revenue.

Cash Flow Evaluations:

Doing cash flow analysis on wise is not the easiest thing because it accepts deposits. But I want to understand its ability to flow cash without deposits. So, I took its FCF and removed the change in their deposits. Using FCF for the last 12 months gives 3.5B minus the change in deposits which is 2.4B. FCF – deposits would be 1.1B for the TTM. Utilizing a Reverse DCF w/ 1.1B Wise would have to grow its FCF at 0% for 10 years for its current price.

Since FCF – deposits was approximately 2 and half times its Net Income, I decided that was a unrealistic and decided to take a different approach by having FCF – Change in Other Net Operating Assets (FCF +). Which is taking the 3.5B minus 2.951B giving me 549M. Utilizing a Reverse DCF w/ 549M it shows that Wise has to grow its FCF at 7% for 10 years at its current price. Using this method for its current FCF + it’s been growing at over 173% YoY.

Cash flow thoughts, I have made some assumptions and they may be incorrect in the deep dive into Free Cash Flow because Wise has similar functions to banks with accepting deposits and making interest off the deposits. But I wanted to try and get a picture of its FCF of its non-banking parts of the company which generate most of the revenue. If anyone knows more about how to get a more accurate understanding of evaluating its FCF I would love to hear it. I think the real answer is somewhere between the two numbers but probably closer to the 7% than the 0% growth needed for its current price. I utilized the Reverse DCF calculator from Brian Stoffel. With some minor changes to have it convert GBP to USD. All this analysis was done on the H1 report from Nov 2024.

Concerns:

Wise is heavily influenced by exchange rates which can affect its bottom line. It’s also a British company and owning shares gives exposure to the British Pound. Last month the British Pound lost 2.5% to the United States Dollar. Wise can be hurt by political factors affecting foreign trade and the ability to move money.

Final Thoughts:

Wise continues to demonstrate strong performance and strategic execution, making it an appealing option for investors. The company’s ability to grow Cross-Border Revenue and Card Revenue —despite lowering transaction prices—highlights its commitment to gaining market share and improving customer value. Wise’s strong cash flow generation and its focus on growing high-margin revenue streams, like card services, further enhance its financial position. I’m maintaining my current position in Wise.

Drew

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Long time personal+business customer & shareholder (I actually discovered the company as an investment in late 2021 when looking for an international business bank account).

Broadly agree with your required FCF growth of 7% figure (I actually get 9% using my own Reverse DCF, but that’s splitting hairs), Wise still pretty reasonably priced, especially in the context of the current hot market. It’s hard to find something worth adding new money to, but Wise would seem to fit that bill.

This extract from the recent announcement in particular rather excites me as a shareholder. Wise Platform is now supporting two of the tier-1 global banks. For me, they’ve now proven that they have a sustainable competitive advantage in FX, and that transaction volumes are going to continue to grow for the long-term as increasingly the major players come onboard.

“Wise Platform continues to bring the power of the Wise infrastructure directly to our partners and their customers. We were delighted to announce that Morgan Stanley is now using Wise for international settlements capabilities for its corporate customers. Additionally, we announced that Wise will soon power faster and cheaper international payments for Standard Chartered’s cross-border payment service, SC Remit. These partnerships provide even more people and businesses with easy access to a service that continues to become faster and lower cost. Given their scale, entering into relationships with such leading global institutions represents important milestones in our journey as we move closer towards achieving money without borders.”

  • Kristo Käärmann, Co-founder and Chief Executive Officer (edited)
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