Paysafe Limited (NYSE:PSFE) Q2 2023 Earnings Conference Call August 15, 2023 8:30 AM ET

Company Participants

Kirsten Nielsen - Head of IR

Bruce Lowthers - CEO & Executive Director

Alexander Gersh - CFO

Conference Call Participants

Scott Wurtzel - Wolf Research

Aditya Buddhavarapu - Bank of America

Timothy Chiodo - Credit Suisse

James Friedman - Susquehanna

Operator

Hello, and welcome to the Paysafe Q2 2023 Earnings Conference Call and Webcast. [Operator Instructions] A 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 turn the call over to Head of Investor Relations, Kirsten Nielsen. Please go ahead, Kirsten.

Kirsten Nielsen

Thank you and welcome to Paysafe's earnings conference call for the second quarter of 2023. Joining me today are Bruce Lowthers, Chief Executive Officer and Alex Gersh, Chief Financial Officer.

Before we begin, a reminder that this call will contain forward-looking statements and should be considered in conjunction with cautionary statements contained in our earnings release and the company's most recent SEC reports. These statements reflect management's current assumptions and expectations, and are subject to factors that could cause actual results to differ materially from those forward-looking statements. You should not place undue reliance on these statements. Forward-looking statements during this call speak only as of the date of this call and we undertake no obligation to update them.

Today's presentation also contains non-GAAP financial measures. You can find additional information about these measures and reconciliations to the most directly comparable GAAP financial measures in today's press release, and in the appendix of this presentation, which are available on the Investor Relations section of our website.

With that, I will turn the call over to Bruce.

Bruce Lowthers

Thanks, Kirsten. Good morning, and thank you for joining us today. So let's begin with Slide 3. We're pleased to announce our second quarter results, which marks our fourth consecutive quarter of year-over-year revenue growth. Second quarter revenue of $402 million increased 6% year-over-year, or 5% on a constant currency basis, with trends broadly consistent with what we had discussed in the first quarter. We recorded 6% growth in the Merchant Solutions segment, on continued resiliency in our SMB market and high-teens growth from e-commerce led by iGaming in North America.

In Digital Wallets, revenue increased 5% on a constant currency basis, driven by our classic digital wallets, where we continue to see improved user engagement. Second quarter adjusted EBITDA of $113 million increased 10% year-over-year and 9% on constant currency was a 90 basis point -- 90 basis points of margin improvement. We continue to drive our sales transformation to reinvigorate growth in our strategic verticals across Gaming, Digital Assets, Travel and Leisure, and Retail and Hospitality.