Western Union — Third Quarter 2026 Earnings Summary

Financial Performance:

• GAAP revenue was $1.0 billion, a 2% decrease from the prior year period; adjusted revenue declined 1% year-over-year.
• GAAP earnings per share (EPS) were $0.25, down from $0.43 in the prior year period; adjusted EPS were $0.42, down from $0.47.
• GAAP operating margin was 13% compared to 20% in the prior year period; adjusted operating margin was 18% compared to 20%.
• GAAP effective tax rate was 19% compared to 17% in the prior year period; adjusted effective tax rate was 9% compared to 12%.
• Net income for the nine months ended September 30, 2026, was $219.4 million, a 43% decrease from $385.2 million in the prior year period.
• Operating income for the nine months ended September 30, 2026, was $385.9 million, a 33% decrease from $572.0 million in the prior year period.
• Net cash provided by operating activities for the nine months ended September 30, 2026, was $321.2 million, down from $408.3 million in the prior year period.
• Cash and cash equivalents on the balance sheet as of September 30, 2026, were $1.098 billion, down from $1.234 billion as of December 31, 2025.
• Total borrowings were $2.888 billion as of September 30, 2026, compared to $2.878 billion as of December 31, 2025.

Guidance and Future Outlook:

• Full-year 2026 revenue outlook is updated to 0% to 1% growth (GAAP and adjusted) assuming the Intermex merger closes by November 10, 2026; excluding Intermex, the outlook is (2)% to (1)% growth.
• Full-year 2026 adjusted EPS outlook is $1.28 to $1.38, regardless of Intermex closing status; GAAP EPS guidance is not provided.
• Full-year 2026 adjusted effective tax rate is expected to be 10% to 12%; GAAP effective tax rate is expected to be 20% to 22%.
• Outlook assumes no material changes in macroeconomic conditions, including immigration policies, foreign currencies, Argentina inflation, or ongoing conflicts in the Middle East.

Business Segments and Product Lines:

• Branded Digital revenue grew 8% on both GAAP and adjusted bases, with transaction growth of 21% year-over-year; this segment represented 32% of total CMT revenues and 45% of CMT transactions.
• Consumer Services segment revenue declined 2% on a GAAP basis but grew 5% on an adjusted basis, driven by higher revenues from bill payment and check cashing businesses, partially offset by slowdowns in money order and media network businesses.
• Consumer Money Transfer (CMT) segment revenue decreased 2% on both GAAP and adjusted bases, while transactions grew 2% year-over-year.
• CMT segment operating margin was 17% in the third quarter, down from 20% in the prior year period.
• Consumer Services segment operating margin was 21% in the third quarter, down from 22% in the prior year period.
• Regional CMT revenue performance for the quarter: North America declined 7% (GAAP), EU & CIS was flat (0%), MEASA grew 6%, LACA declined 5%, and APAC declined 4%.

Market and Competitive Landscape:

• The slowdown in the North America retail business was a primary driver for the decline in adjusted revenue.
• Management noted continued investment in digital capabilities, AI embedding across operational processes, and advancing stablecoin and next-generation money movement initiatives.
• The company operates across more than 200 countries and territories with nearly 130 currencies.

Risks and Challenges:

• The Intermex merger is subject to the reinstatement of the California Department of Financial Protection and Innovation (DFPI) approval; the merger agreement contains termination rights if the deal does not close by November 10, 2026.
• The sale of Russian assets received final regulatory approval in October 2026, with closing anticipated upon satisfaction of remaining conditions.
• Forward-looking statements are subject to risks including changes in economic conditions, trade disruptions, migration patterns, geopolitical tensions, regulatory changes, cybersecurity incidents, and failure to realize benefits from the Intermex acquisition.

Management Commentary and Tone:

• Devin McGranahan, President and CEO, stated that initiatives launched in the second quarter are streamlining the cost structure and beginning to materialize in financial results.
• Management expressed confidence in the ability to improve performance and create long-term shareholder value while moving through the second half of the year.
• The company is making progress against its "Beyond strategy," which includes expanding digital capabilities and advancing next-generation money movement.

Other Key Points:

• On August 10, 2025, the Company entered into an agreement to acquire International Money Express, Inc. (Intermex).
• The company incurred $37.3 million in one-time expenses related to the "Beyond efficiency program" in the third quarter, including severance and workforce reductions.
• Cash dividends and dividend equivalents paid were $226.5 million for the nine months ended September 30, 2026.
• Common stock repurchased totaled $65.7 million for the nine months ended September 30, 2026.
• Beginning in the second quarter of 2025, the company no longer excludes the estimated impact of Argentina inflation from non-GAAP results due to inflation moderation to below 50%.
• Branded Digital revenues and transactions now include digital wallet remittances as of the second quarter of 2026.