Payments major Wise posts 33% YoY jump in revenue for FY22 as costs rise

Global payments firm Wise recorded strong growth in revenue and profit right after its CEO Kristo Kaarmann was said to be under investigation by UK authorities due to his tax affairs.

Photo credit: Wise

Wise posted a 33% year-on-year increase in revenue to almost 560 million pounds (US$683.6 million) for its 2022 financial year ended March 31, the company said in its first financial report as a publicly listed firm.

The growth was mainly driven by rising transaction volumes. Total volume transferred in FY22 was US$93.2 billion, up 40% from FY21.

Adjusted EBITDA, meanwhile, saw a 12% year-on-year rise to US$148.1 million for the period. The company reported a reduced adjusted EBITDA margin – from 26% to 22% – as it planned to invest back into its teams, products, and marketing.

Its gross profits registered a 43% increase to US$453.7 million during the same period.

However, Wise’s growth in these areas came with 48% and 31% increases in the company’s administrative and employee costs, respectively. The company spent US$392 million on the former and US$225.4 million on the latter.

The payments firm said it will continue to invest sustainably into its infrastructure, with a target adjusted EBITDA margin at or above 20%. It’s also looking to hit revenue growth of between 30% to 35% in FY23.

In July 2021, Wise listed on the London Stock Exchange at a valuation of US$11 billion.

The financial report comes after Kaarmann came under investigation by the UK’s Financial Conduct Authority for failing to pay over US$878,000 for the 2017 to 2018 tax year, resulting in a US$446,000 fine.

The regulator has the power to deem Kaarmann unfit to be a senior manager of an investment firm, a role he occupies as Wise offers stock trading in addition to international payments.

Currency converted from pound sterling to US dollar: US$1 = 0.82 pounds.

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