Flywire Corporation (NASDAQ:FLYW) Q1 2023 Results Conference Call May 9, 2023 5:00 PM ET

Company Participants

Akil Hollis - VP of FP&A and Investor Relations

Mike Massaro - Chief Executive Officer

Robert Orgel - President and Chief Operating Officer

Mike Ellis - Chief Financial Officer

Conference Call Participants

Bob Napoli - William Blair

John Davis - Raymond James

Tyler DuPont - Bank of America

Darrin Peller - Wolfe Research

Ken Suchoski - Autonomous Research

Dan Perlin - RBC Capital Markets

Tien-Tsin Huang - JPMorgan

Bob Napoli - William Blair

Ken Suchoski - Autonomous Research

Operator

Greetings, and welcome to the Flywire Corporation First Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation [Operator Instructions]. As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Akil Hollis, VP of FP&A and Investor Relations. Please go ahead.

Akil Hollis

Thank you, and good afternoon. With me on today's call are Mike Massaro, Chief Executive Officer; Robert Orgel, President and Chief Operating Officer; and Mike Ellis, Chief Financial Officer. Our first quarter 2023 earnings press release, supplemental presentation and when filed, Form 10-Q can be found at ir.fir.com. During the call, we will be discussing certain forward-looking information. Actual results could differ materially from those contemplated by these forward-looking statements. We will also be discussing certain non-GAAP financial measures. Please refer to our press release and SEC filings for more information on the risks regarding these forward-looking statements that could cause actual results to differ materially and the required disclosures and reconciliations related to non-GAAP financial measures. This call is being webcast live and will be available for replay on our website.

I would now like to turn the call over to Mike Massaro.

Mike Massaro

Thank you, Akil, and thank you to everyone that is joining us this afternoon. We are excited to share our Q1 2023 results that show strong performance and momentum across the business. In a few minutes, Rob Orgel, our President and COO; as well as Mike Ellis, our CFO, will go into greater detail about our results for the quarter, but I will first share some highlights from our Q1 performance. Revenue less ancillary services was $89.1 million during the quarter, representing year-over-year growth of 50% or 57% on a constant currency basis. Adjusted gross profit for the quarter was $59.9 million, an increase of 50% year-over-year. And adjusted EBITDA was $7 million for the quarter, representing a 470 basis point increase in our adjusted EBITDA margin versus Q1 2022. So as you can see, Q1 2023 was a great quarter for Flywire, driven by the efforts of our fly mates all around the world, continuing to execute against our growth strategies while also making progress against our 3 investment areas that I will provide more updates on now. First, we continue to invest in enhancing and optimizing our go-to-market efforts with a key focus on high ROI areas. As we have shared before, a key part of our focused go-to-market this year is around accelerating our channel and technology partners across all verticals. When we integrate directly with our partners, it makes the onboarding process and technology implementation faster and more effective for our clients. And it further deepens Flywire defensible moat. As validation of our focus in this area, we are proud to share that Flywire was recently named the 2022 Partner of the Year for integration excellence by Illusion, one of our strategic partners in education and a leading ERP with major market share in North America.