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Why Flywire and Airbnb Could Be Quiet Winners of a CeasefireFlywire NASDAQ: FLYW reported second-quarter results that exceeded its expectations, led by travel performance, hospitality payment processing and stronger-than-anticipated contributions from healthcare and B2B payment-processing ramps. The company also raised its full-year revenue and adjusted EBITDA outlook, while maintaining a cautious posture toward international student visa trends in major education markets.
Total revenue less ancillary services reached $164 million, up more than 28% year over year on a spot basis and 27% on an FX-neutral basis, Chief Financial Officer Cosmin Pitigoi said. Transaction revenue increased 35% to $135.9 million, supported by 43% growth in transaction payment volume. Adjusted gross profit rose 19% to $93 million, while adjusted EBITDA increased to $24 million, producing a 14.6% margin and approximately 160 basis points of year-over-year expansion.
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The company recorded a GAAP net loss of $8 million in the quarter, improving from a $12 million loss in the prior-year period. Pitigoi said the second quarter is Flywire’s smallest revenue quarter seasonally and that net income and free cash flow are expected to be strongly positive for the full year.
Travel, Healthcare and B2B Support Results Pitigoi said Flywire’s revenue outperformance versus the midpoint of its outlook was driven largely by travel, where hospitality payments ramped faster than expected. Education revenue also exceeded internal expectations.
Payment processing in healthcare and the migration of B2B invoice customers added an approximately seven-point growth tailwind to payment processing during the quarter, above the mid-single-digit contribution Flywire had anticipated. The company expects that benefit to decelerate in the second half as it annualizes the related go-lives.
Adjusted gross margin was 56.6%, down about 450 basis points year over year. Pitigoi attributed roughly 300 basis points of the decline to the mix effect of higher payment-processing revenue from healthcare and B2B. He said the remaining decline reflected continued changes in vertical mix, rather than pricing pressure or less-disciplined competition.
“Processing volume carries the lower gross margin rate, but very little incremental OpEx because it runs over infrastructure and relationships we already have,” Pitigoi said, adding that these revenue streams can still convert gross profit dollars to EBITDA at a high rate.
Education Strategy Focuses on Software and Geographic Diversification Chief Executive Officer Mike Massaro said Flywire continues to operate in a difficult international education environment, citing negative visa trends in the United Kingdom, higher visa fees in Australia and more stringent regulations in the U.S. and U.K. The company’s guidance incorporates an assumed 30% decline in U.S. visas, which management described as a prudent approach.
Despite those pressures, Flywire said it is gaining share and expanding outside its traditional core education markets of the U.S., U.K., Canada and Australia. Education revenue from markets outside those four countries grew more than 30% year over year in the second quarter, and roughly two-thirds of new education clients signed during the quarter were in those growth markets.
President and Chief Operating Officer Rob Orgel pointed to momentum in continental Europe, including share gains in Spain and Switzerland, as well as activity in South Korea and Japan, where institutions are seeking international enrollment. The company also cited wins in Canada and Australia, including Sheridan College and Bond University.
Flywire signed more than 200 new clients across 45 countries and all of its verticals, matching the level reached in the first quarter. Travel led new-client additions, followed by education, according to Orgel.
In education, the company is emphasizing its Student Financial Services, or SFS, platform, which combines billing, payment plans, collections and payment processing. Flywire signed the University of Liverpool for SFS in the U.K. and signed three new U.S. SFS deals whose combined annual recurring revenue was double that of signings in the comparable 2025 quarter.
Orgel said clients using SFS have in some cases reduced inbound student-contact volume by 40%. He also said self-service payment plans have increased plan enrollment by roughly 50%, while default rates have declined from as high as 34% to below 2%. Flywire clients have collected more than $360 million in past-due tuition in-house, saving more than $70 million in agency fees, according to the company.
Hospitality, AI and Margin Goals Flywire’s hospitality software is used across more than 20,000 properties, Orgel said. The company has won contracts with hotel management groups including Peregrine Hospitality, Avion Hospitality and Marcus Hotels & Resorts. It has also signed more than 40 hospitality locations in Europe and Asia year to date as it expands a business that was historically concentrated in the U.S.
Management said artificial intelligence is increasingly being deployed in support, engineering and sales operations. Massaro said about 45% of customer inquiries are now resolved automatically without human intervention, with a target to exceed a 50% automated-resolution rate by year-end.
The company is also using AI tools and autonomous agents for tasks including code retirement, bug fixes, test maintenance and sales coaching. Flywire views these initiatives as part of a broader digital transformation intended to lower its cost to scale and generate operating leverage.
Massaro reiterated Flywire’s longer-term goal of reaching $1 billion in annual organic revenue and a 30% adjusted EBITDA margin over the next few years. Pitigoi said the company is targeting approximately a 25% adjusted EBITDA margin by 2027 and expects transformation investment to peak that year, with material savings expected afterward.
Raised 2026 Outlook Flywire raised its full-year 2026 outlook and now expects FX-neutral revenue growth of 21% to 27%. The forecast includes approximately three to four percentage points of growth from B2B and healthcare payment-processing ramps, as well as roughly 1.5 percentage points of inorganic contribution as the company laps Sertifi.
Adjusted gross profit is expected to grow in the high teens year over year on a spot basis. Adjusted EBITDA margin is expected to expand by roughly 200 to 400 basis points, reaching about 23% at the midpoint. Free cash flow conversion is expected to equal 70% to 75% of adjusted EBITDA. GAAP net income is expected to increase more than fourfold to over $50 million. Stock-based compensation is targeted at approximately 10% of revenue, with less than 2% dilution targeted for 2026. For the third quarter, Flywire expects FX-neutral revenue growth of 16% to 22%, low-teens gross profit dollar growth at spot rates, and roughly 200 basis points of adjusted EBITDA margin expansion at the midpoint. Management cautioned that education payment timing around U.K. deadlines and Chinese holidays could affect the quarter-to-quarter distribution of second-half revenue.
About Flywire (NASDAQ:FLYW)Flywire Corp NASDAQ: FLYW is a global payments enablement and software company that specializes in facilitating complex cross-border transactions. Its cloud-based platform streamlines receivables and payer workflows across key verticals including education, healthcare, travel and hospitality, and commercial services. Flywire's technology integrates with institutional systems to automate payment posting, reconciliation and reporting, aiming to improve the payer experience and accelerate cash flow for its clients.
Founded in 2009 by entrepreneur Iker Marcaide as peerTransfer, the company rebranded as Flywire in 2015.
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