(EDGAR Online via COMTEX) -- Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operation You should read the following discussion and analysis of our financial condition and results of operations together with our consolidated financial statements and the related notes appearing elsewhere in this Quarterly Report on Form 10-Q and our audited consolidated financial statements and the related notes and the discussion under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations" for the year ended December 31, 2020 included in the Final Prospectus. You should read the sections titled "Risk Factors" and "Special Note Regarding Forward-Looking Statements" for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. Overview Remitly is a leading digital financial services provider for immigrants and their families in over 135 countries around the world. Our differentiated approach to addressing the complexity of cross-border remittances and financial services is comprised of four core elements: Providing a simple and reliable way of sending money with our mobile-centric suite of products. Today, over 90% of our customers engage with Remitly on their mobile phones, shifting what traditionally required waiting in line to speak with an agent to the palm of their hands. Our mobile app currently has a 4.9 iOS App Store rating with more than 582,000 reviewers and a 4.8 Android Google Play rating with more than 279,000 reviewers. We have achieved this level of engagement and these high ratings by designing mobile-centric products that make the customer experience simple and convenient and give our customers complete peace of mind. Conveniently putting money safely in the hands of our customers' families, wherever they are, by relying on our global network. Our global network of funding and disbursement partnerships enables us to complete money transfers in over 1,800 corridors without the need to deploy local operations in each country. We have partner relationships with top tier banks and leading global payment providers to give our customers an array of payment (or pay-in) options, including with a bank account, credit card or debit card, and alternative payment methods. Our disbursement network provides our customers with a choice of delivery and enables us to send (or pay-out) funds within minutes, to more than 3.6 billion bank accounts, over 660 million mobile wallets, and approximately 380,000 cash pickup locations (including retail outlets and banks). These partner relationships help drive a better customer experience, including faster transfers, higher acceptance rates, and enhanced reliability. Creating trusted and personalized experiences with our localization expertise at scale. We believe our expertise in localizing our marketing, products and customer support at scale is a key differentiator. For example, we tailor our customer experience with over 14 native languages and we drive peace of mind with our global customer support team. Additionally, for disbursement of funds, we partner with local brands that are among the most trusted and recognized by our customers, their families, and their other recipients. Using our data-driven approach to better serve our customers and provide more value. We have a data-driven approach to how we grow our business, prioritize our investments, and manage our operations. Because our customers initiate transfers digitally, we capture and leverage a body of transaction-related data that provides insight into customer behavior and customer experience. This data and the analytics we perform inform our marketing investments and product development prioritization. In addition, we leverage our data platform and proprietary models to manage pricing, treasury, risk, and customer support. The combination of our differentiated approach and our relentless focus on meeting the financial services needs of our immigrant communities has resulted in significant customer growth, high customer engagement, rapid send volume and transaction growth, and attractive customer economics built on top of an expansive global network.
Our Revenue Model
Active Customers Three Months Ended September 30, 2021 2020 (in thousands) Active customers 2,561 1,692
We believe that the number of our active customers is an important indicator of customer engagement and the overall growth of our business.
expansion, and the continued growth in adoption of digital remittances as a result of the COVID-19 pandemic. As Active customers are measured on a quarterly basis, the data for the nine month periods are not meaningful.
Send Volume Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 (in millions) Send volume $ 5,239 $ 3,245 $ 14,488 $ 8,429
We measure send volume to assess the scale of remittances sent using our platform. Our customers mostly send from the United States, Canada, United Kingdom, other countries in Europe, and Australia. The recipients are located in over 120 countries across the globe; the largest receive countries include India, the Philippines, and Mexico.
We have a history of successfully monitoring customer acquisitions costs ("CAC") and will continue to be strategic and disciplined toward customer acquisition. For example, for performance marketing, we set rigorous customer acquisition targets that we continuously monitor to ensure a high return on investment over the long term, and we can increase or decrease this investment as desired. Corridor Mix
Impact of the COVID-19 Pandemic
Customer Support and Operations
Comparison of the three and nine months ended September 30, 2021 and 2020
Revenue Three Months Ended September 30, Change Nine Months Ended September 30, Change (dollars in thousands) 2021 2020 Amount Percent 2021 2020 Amount Percent Revenue $ 121,244 $ 71,790 $ 49,454 69 % $ 323,350 $ 176,939 $ 146,411 83 %
Revenue increased $49.5 million, or 69%, to $121.2 million for the three months ended September 30, 2021. This increase was primarily driven by growth in send volume, which increased $2.0 billion, or 61%, to $5.2 billion for the three months ended September 30, 2021, compared to $3.2 billion for the three months ended September 30, 2020, reflecting both an increase in active customers, as well as increased transaction frequency among our active customers, resulting in an increase in the average revenue per active customer compared to the third quarter in 2020.
Transaction Expenses Three Months Ended September 30, Change Nine Months Ended September 30, Change (dollars in thousands) 2021 2020 Amount Percent 2021 2020 Amount Percent Transaction expenses $ 47,560 $ 28,046 $ 19,514 70 % $ 135,175 $ 74,256 $ 60,919 82 % Percentage of total revenue 39 % 39 % 42 % 42 %
Transaction expenses increased $19.5 million, or 70%, to $47.6 million for the three months ended September 30, 2021, compared to $28.0 million, for the three months ended September 30, 2020. The increase was primarily due to a $15.7 million increase in direct costs associated with processing a higher volume of our customers' remittance transactions and the disbursement of our customers' funds to their recipients, a $3.0 million increase in fraud and other losses largely driven by growth in new customers and send volume, and a $0.8 million increase in other transaction expenses, primarily software and tools that support our compliance and risk operations.
Transaction expenses increased $60.9 million, or 82%, to $135.2 million for the nine months ended September 30, 2021, compared to $74.3 million, for the nine months ended September 30, 2020. The increase was primarily due to a $49.2 million increase in direct costs associated with processing a higher volume of our customers' remittance transactions and the disbursement of our customers' funds to their recipients, a $9.1 million increase in fraud and other losses largely driven by growth in new customers and send volume, and a $2.6 million . . .
Nov 12, 2021
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