Q & A Highlights
Q: Given we’re in September, how should we think about the rest of the year in regard to low end and high end of the guidance on growth? And on margins, how should we read the headcount decline year-to-date? Is the company now entering a phase of margin expansion, and should that be 100 basis points or 200 basis points per year?A: CFO Robert Whittick explained that the $135 million low end of guidance assumed none of the delayed connections in the key merchant relationship went live, while the $142 million high end assumed they did. Since all of those connections have now gone live (some still in testing), the company is sticking to its guidance range at this stage, though the launches are a positive step. On margins, he said the new leadership team, including the new Chief Commercial Officer and Chief Product Officer, will work through the budget process over the coming months, with medium-term forecasts to be provided at the full year results in March 2027.
Q: How should we think about the opportunity with Stripe in terms of TPV? Can you give color on geographies, number of merchants, and line of sight on TPV, and how this can grow into next year?A: CEO Stuart Neal emphasized that Boku has a channel strategy, not a Stripe strategy, with Stripe being the first formally signed global-scale channel partner. He noted Stripe has 5 million merchants globally, but Boku is still in the testing phase with one country live, three more technology-tested and due to switch on later in the year, and a handful of merchants with test volumes. He said it is too early to predict volumes, the company is cautiously optimistic, and no assumptions are being made in the numbers that the partnership will be transformative in the next 12 to 18 months.
Q: In terms of the geographies that have recently launched, you talked about confidence that this can offset the volumes you’re losing in the other geography. Are you able to give more color on initial observations in terms of volume development in those new geographies?A: CFO Robert Whittick said the connections delayed from H1 have now gone live, and the company is cautiously pleased with volumes to date. Testing still needs to be completed in a couple of those markets, but at this stage management is happy with progress and looks forward to concluding testing and progressing positively through the end of the year.
Q: Just in terms of dual sourcing, as a general risk with any other merchants in any other geographies, if you could make any sort of comment around that?A: CEO Stuart Neal explained that every merchant dual-sources at some level, whether between cards and local payment methods or on a country-by-country basis. What was different in this specific case was that the merchant’s technology allowed it to split transactions on a specific connection for risk and supplier management purposes. He stressed that Boku does not see dual-sourcing as existential, believes it will be a net beneficiary of this merchant’s policy, and said the company simply has to remain super competitive with the best products and services in the market.
Q: You mentioned improving the density and economics of the network. Do most wallets only have a handful of merchants connected, or are there some older connections where you’ve scaled to most of your merchants?A: CFO Robert Whittick confirmed that with over 200 LPMs on the network, increasing the number of merchant connections into each well-performing LPM is the obvious route to maximizing merchant reach. This is why revenue per LPM is rising, as more connections are made from merchants into each LPM that performs well.
Q: The new CCO has been in the seat for a couple of months, came from Mastercard. Are you able to share any learnings and observations he’s provided?A: CEO Stuart Neal said Peter Klein came from Mastercard, where his role involved building a non-card rail within a card network. Peter joined Boku because he saw the opportunity to create a global non-card rail from outside a card network. His key observation from the outside was that Boku has an incredible set of assets and a unique opportunity with its customer base, but the company needed to believe in itself more and tell its story more broadly. His initial takeaway is that Boku needs to shout louder in the market.
Q: On Bundling, which is becoming a bigger part of the P&L, can you give more color on the number of merchants utilizing Bundling and how that offering might evolve over time?A: CEO Stuart Neal said Bundling is really taking off, linked to the explosion of the subscription economy into many more services all seeking growth and distribution. Historically Boku ran half a dozen big global bundling programs with global merchants, but it is now seeing much more inbound interest from companies seeking distribution help. The model connects subscription businesses with suppliers such as mobile operators and digital wallets that hold tens of millions of potential consumers, and the offering is becoming increasingly popular, as reflected in the numbers.
Q: I wanted to ask about cross-border settlement volumes, which you noted were growing at 9%. How do you expect those to ramp over time? Is that currently coming from a single customer, and do you expect to expand with other merchants?A: CFO Robert Whittick said growth comes from two areas: organic growth in the existing book, and legacy LPMs that previously did currency conversions for Boku, with that conversion gradually being taken in-house. Both areas are expected to continue growing over the coming months. CEO Stuart Neal added that this is a portfolio approach, with some large markets not requiring cross-border currency conversion but offering significant domestic volumes, while emerging markets with bigger cross-border commerce challenges are where Boku can really add value.
Q: On agentic commerce, how do you think Boku will be positioned going forward as the space evolves, and what sort of products would you expect to be working on on top of the Boku stack?A: CEO Stuart Neal said there is a massive set of opportunities in this space, with agentic being one but not the only game in town. He noted that in payments it is often the boring things that matter, such as reconciliation, network monitoring, and optimizing conversion rates, all of which can be enhanced by AI. He also pointed to the card world’s emerging use case of creating agents that can buy on a consumer’s behalf, with a host of challenges and opportunities in that area that Boku will be looking at.
Q: Great win with the channel partnership. How should we think about TPV and revenue contribution in 2027?
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
