Wise shares slide after forecasts disappoint
The UK fintech company also revealed that profits more-than-tripled for the past year.
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Your support makes all the difference.Money transfer firm Wise saw its shares tumble after profit forecasts disappointed investors.
The UK fintech company also revealed that profits more-than-tripled for the past year, but saw positivity surrounding this eclipsed by concerns over its outlook.
Wise, which was launched in 2011 under original name TransferWise, pointed towards 15-20% growth in its underlying income for the current financial year in its fresh update.
However, the projection was below analyst forecasts and significantly short of the 31% growth seen last year.
The company also said it plans to reduce fees but increase investment on its payment infrastructure, in a move expected to weigh on profit margins.
Nevertheless, it came as the company revealed that revenues grew by almost a quarter, 24%, to £1.05 billion for the year to March 31.
This came as its active customer base grew by 29% to 12.8 million for the year. It added that pre-tax profits jumped by 229% to £481.4 million for the year.
Kristo Kaarmann, co-founder and chief executive officer, said: “2024 was another strong year of growth for Wise.
“We are investing in infrastructure and customer experiences to serve as much of this huge, under-served cross-border payments market as possible, including starting full-year 2025 by reducing fees further for our customers.”
AJ Bell investment director Russ Mould said Wise “demonstrated the truth of the old idiom that markets are inherently forward looking as despite posting a big increase in annual profit, a weak outlook caused shareholders to desert the company in droves”.
He added: “If Wise was trying to inject a dose of conservatism to its forecasts to help manage market expectations, the move seems to have backfired for now.”
Shares in the company fell by 16.3% on Thursday morning.