Thanks Anirban, for the interesting write up.
This happened in January, 2015:
</>http://seekingalpha.com/article/2799895-a-theft-of-30_8-mill…
XOOM states it was “the victim of a criminal fraud” involving “employee impersonation and fraudulent requests targeting the Company’s finance department, resulting in the transfer of $30.8 million in corporate cash to overseas accounts.” (8-K)A $30.8M one-time charge will be recorded. The online money transfer service provider insists “no customer data was involved nor was any customer’s money involved in this matter and the Company’s systems were not impacted.” Federal law enforcement authorities are "actively pursuing a multi-agency criminal investigation."CFO Matt Hibbard has resigned. Ryno Blignaut, who only recently stepped down as CFO, will serve as acting CFO and chief risk officer.The disclosures are overshadowing a Q4 guidance hike: Xoom now expects to report Q4 revenue of $43.1M-$43.6M, above prior guidance of $41M-$43M and a $41.8M consensus. Active customers +21% Y/Y in Q4 to 1.28M (+22% in Q3); new customers +5% to 118K (-22% in Q3).
I would imagine this is a negative event of seminal proportions.
We use this service to send money to the Philippines and have been for several years. Years ago I used to use WU but that got to be expensive and time consuming. Maybe WU is digital now and the same thing can be accomplished but we have a habit and see no reason at this point to change. I would point out that if WU is now digitized and is cheaper than XOOM, I’d quickly switch which to me says they have no moat and being the runt in the liter, could easily go away.
I’d also like to know why their growth is slowing and will try to research this and then share here. Maybe they should use that company Saul talked about but that no one wants to buy due to no profits and a high P/E?
Mykie