Euronet Worldwide, Inc. (EEFT Quick QuoteEEFT - Free Report) reported second-quarter 2024 adjusted earnings of $2.25 per share, which matched the Zacks Consensus Estimate. The bottom line advanced 11% year over year.

Total revenues improved 5% year over year, or 6% on a constant-currency basis, to $986.2 million. Yet, the top line fell short of the consensus mark by 2.4%.

Strong performance in the EFT Processing segment, driven by growth in high-volume low-value transactions in India, alongside solid revenue growth in the Money Transfer segment, due to cross-border and digital transactions, provided a boost to Euronet’s quarterly results. However, the upside was partly offset by pressure on the epay segment due to the absence of promotional campaigns and increased operating expenses.

Q2 Update

EEFT reported a net income of $83.2 million, which fell 3.3% year over year. Operating income rose 10% year over year, or 12% on a constant-currency basis, to $134.3 million. 

Total operating expenses of $851.9 million increased 4.3% year over year due to higher direct operating costs, salaries and benefits, and selling, general and administrative expenses. 

Adjusted EBITDA grew 7% year over year, or 10% on a constant-currency basis, to $178.2 million.

Segmental Performances

The EFT Processing segment’s revenues were $305.4 million in the second quarter, which improved 8% year over year and 10% on a constant-currency basis. However, the metric lagged the Zacks Consensus Estimate of $310.9 million.  

Adjusted EBITDA climbed 17% year over year, or 20% on a constant-currency basis, to $105 million.

Operating income of $79.9 million advanced 16% year over year and 19% on a constant-currency basis. Total transactions of the unit soared 34% year over year to 2,737 million, attributable to improved high-volume low-value transactions across India.

Continued growth in travel, an improving merchant acquiring business and expansion into new markets aided the unit’s performance. 

The epay segment recorded revenues of $260.9 million, which dipped 1% year over year and remained flat on a constant-currency basis. The reported figure missed the consensus mark of $280.3 million.

Adjusted EBITDA slipped 2% year over year to $28 million.

Operating income totaled $26.2 million, down 2% year over year. Transactions in the unit rose 13% year over year to 1,110 million on the back of continued expansion of high-volume low-value transactions in India.

The segment’s quarterly results were impacted due to the absence of promotional campaigns that were conducted by epay for its retail partners in the prior-year quarter.

The Money Transfer segment’s revenues of $421.8 million grew 7% year over year and 8% on a constant-currency basis. The metric surpassed the Zacks Consensus Estimate of $420.3 million.

Adjusted EBITDA of $54 million slipped 2% year over year and 1% on a constant-currency basis. 

Operating income remained almost flat year over year but advanced 2% on a constant-currency basis to $47.3 million. Total transactions were 44.3 million, which grew 8% year over year resulting from significant growth in cross-border transactions and direct-to-consumer digital transactions. However, the upside was partly offset by a decline in intra-U.S. transactions.

Corporate and Other expenses of $19.1 million tumbled 6.8% year over year.

Financial Update (as of Jun 30, 2024)

Euronet exited the second quarter with cash and cash equivalents of $1.3 billion, which grew 1.4% from the figure at 2023 end. Total assets of $6.1 billion increased 2.8% from the 2023-end level. 

Debt obligations, net of the current portion, amounted to $1 billion, which decreased 39.8% from the figure as of Dec 31, 2023. Short-term debt was $1.2 billion.

Equity fell 2.9% from the 2023-end figure to $1.2 billion.

There was roughly $802 million left under EEFT’s revolving credit facilities at the second-quarter end.

2024 Bottom-Line View Reaffirmed

Management continues to expect adjusted earnings per share (EPS) to record 10-15% year-over-year growth in 2024.

Zacks Rank

Euronet currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Finance Sector Players

Here are some other Finance sector players that have reported second-quarter results so far. The bottom-line results of Morgan Stanley (MS Quick QuoteMS - Free Report) , The Goldman Sachs Group, Inc. (GS Quick QuoteGS - Free Report) and Synchrony Financial (SYF Quick QuoteSYF - Free Report) beat the respective Zacks Consensus Estimate.

Morgan Stanley’s second-quarter 2024 earnings of $1.82 per share handily outpaced the Zacks Consensus Estimate of $1.65. The bottom line also compared favorably with $1.24 per share reported in the prior-year quarter. MS’ investment banking (IB) business rebounded. Advisory fees surged 30% year over year. Further, underwriting fees witnessed solid momentum in the quarter. Specifically, equity underwriting income jumped 56% and fixed income underwriting income was up 71%. 

So, total IB fees (in the Institutional Securities division) grew 51% to $1.62 billion. However, despite a 24% increase in interest income, the company’s net interest income (NII) witnessed modest growth due to higher interest expenses. Net income applicable to common shareholders (GAAP) was $2.94 billion, up 44% from the year-ago quarter. Quarterly net revenues were $15.02 billion, up 12% from the prior-year quarter. The top line beat the Zacks Consensus Estimate of $14.18 billion. NII was $2.07 billion, up 3%. 

Goldman Sachs reported second-quarter 2024 earnings per share of $8.62, which surpassed the Zacks Consensus Estimate of $8.52. This compares favorably with $3.08 reported in the year-earlier quarter. Net earnings of $3.04 billion increased significantly from $1.22 billion in the prior-year quarter. Net revenues for the quarter of $12.73 billion increased 16.9% from the year-ago quarter. Also, the top line surpassed the Zacks Consensus Estimate of $12.6 billion.

Provision for credit losses was $282 million, plunging 54.1% year over year. The Asset & Wealth Management division generated revenues of $3.88 billion in the reported quarter, up 27.3% year over year. Firmwide assets under supervision were a record $2.93 trillion, up 8.1% from the prior-year quarter. The Global Banking & Markets division has recorded revenues of $8.18 billion, which increased 13.8% year over year. Adjusted operating income grew 8% to $309.2 million.

Synchrony Financial’s second-quarter 2024 adjusted earnings per share of $1.55 comfortably beat the Zacks Consensus Estimate of $1.35. The bottom line also increased from $1.32 per share a year ago. Net interest income improved 6.9% year over year to $4.4 billion in the second quarter. However, it missed the consensus mark by 0.8%. Retailer share arrangements of Synchrony fell 8.7% year over year to $810 million. Total loan receivables of SYF grew 7.9% year over year to $102.3 billion. 

Total deposits were $83.1 billion, which rose 9.7% year over year. Provision for credit losses increased 22.3% year over year to $1.7 billion due to increased net charge-offs. The purchase volume of Synchrony declined 0.9% year over year to $46.8 billion in the second quarter. Interest and fees on loans of $5.3 billion improved 10.2% year over year. Net interest margin deteriorated 48 basis points (bps) year over year to 14.46%.