British digital payments provider Wise has reported an impressive 55% increase in profits for the first half of its 2025 fiscal year, driven primarily by customer growth and expanding market share. The latest financial results reveal a profit of £217.3 million, a notable rise from £140.6 million recorded during the same period in the previous year. This noteworthy achievement is supported by a 25% increase in active customers, bringing Wise’s total client base to an impressive 11.4 million individuals and businesses. The increase in customers reflects Wise’s strategic focus on enhancing user experience and promoting their competitive pricing model.
In conjunction with the profit increase, Wise also reported a 19% year-on-year rise in revenues, which reached £591.9 million in the same reporting period. Following the positive earnings announcement, shares of Wise surged by as much as 8% at 8:02 a.m. London time, accumulating further gains after the previous day’s announcement of a partnership with Standard Chartered. This upswing in stock prices illustrates investor confidence and market optimism following Wise’s strong financial performance. Such growth in revenue and profitability is commendable, especially considering the more conservative forecasts the company had previously issued earlier in the year.
In June, Wise had implemented a more cautious outlook for its fiscal 2025, anticipating year-over-year income growth of only 15-20%. This was in stark contrast to the more robust 31% growth achieved in the preceding year, highlighting the challenges the firm faced as it adjusted its pricing strategies. Reflecting this cautious approach, the firm had to navigate a turbulent market that caused shares to plummet by as much as 21%. However, the recent positive earnings report suggests that these strategic adjustments in pricing may have been effective in attracting and retaining customers despite initial setbacks.
Profit Margins and Future Projections
In Wednesday’s reporting, Wise announced an impressive underlying profit before tax (PBT) margin of 22% for the first half, exceeding its prior target range of 13% to 16%. This figure is significant because it not only reflects Wise’s effective cost management but also their ability to scale operations efficiently. However, the firm acknowledged that the investments made to reduce pricing for its services would likely bring the profit margin back down within the target range for the second half of the fiscal year.
Overall, Wise’s remarkable first half of fiscal 2025 demonstrates a successful recovery from earlier warnings and challenges. By effectively capitalizing on customer growth and maintaining a strategic outlook, Wise is positioning itself for continued success in the competitive digital payments landscape.