Numbers

The Numbers

Wise is a profitable, fast-scaling UK fintech that now earns roughly half of its statutory revenue as interest on customer balances — a rate-sensitive kicker layered on top of a genuinely cash-generative payments engine. Headline margins look exceptional (statutory operating margin 47.8% in FY2025) but the underlying, rate-neutral margin is closer to 20%, and that is the single metric most likely to rerate or derate the stock. The rest of this page is about separating the durable part of the engine from the cyclical float income — and asking whether 27x statutory FY2025 earnings (1090 GBp / 40.4p EPS) is the right number to be paying for it after a 25% rally over the last six weeks.

Snapshot

Is this a well-run business?

Wise's reporting basis makes classic quality scorecards awkward — it is regulated as an EMI, safeguards customer money off-balance-sheet, and has only four full years of post-IPO statements. The quality signal has to come from the operating record itself.

The quality picture is genuinely high: durable growth, fortress liquidity, regulated, profitable. The only honest amber light is cash conversion — statutory net income overstates economic earnings because part of it is non-cash interest accrual on customer float and because Wise re-invests heavily in compliance and treasury infrastructure.

Revenue and earnings power

The step-change is in FY2024 — not because Wise suddenly became a better business, but because central-bank rates reset the yield on £11–14B of customer float. Revenue itself kept compounding at 15–25% throughout.

The underlying PBT margin — what Wise would earn if rates normalised and only the first 1% of yield were retained — plateaued at roughly 20% across FY2024 and FY2025. That is the number that matters for any terminal-value math. If short-rates fall, the 47% statutory operating margin compresses towards this figure.

Half-yearly run-rate

H1 FY26 is the period the bears are watching: revenue still grew 11% YoY and underlying income 13%, but underlying PBT stepped down (£122m vs £147m) — that's a 16.3% underlying PBT margin, the bottom of management's 13–16% target band. The compression reflects (a) Wise passing more interest yield back to customers via the Assets product, (b) deliberate step-up in opex ahead of US listing, and (c) £33m of one-off project costs disclosed in the H1 release.

Cash generation

Wise's statutory cash-flow statement is dominated by movements in customer deposits, which inflates operating cash flow to absurd levels (net cash from operating was £4.5B in FY2025 — nearly 4x revenue). The usable number for shareholders is "underlying free cash flow," which Wise discloses separately.

Underlying FCF runs well below reported net income because part of reported earnings is non-cash interest accrual and because Wise stepped up balance-sheet investment (treasury, licences, safeguarded-account plumbing). H1 FY26 disclosed roughly £117m underlying FCF — annualised, that anchors near £220m, a cash conversion of about 55% of net income. Capex remains tiny in absolute terms (under 3% of revenue), confirming the asset-light profile.

Balance sheet — fortress on a customer float

Total assets ballooned from £7.6B to £19.2B in three years, and 91% of the incremental balance sheet is customer money held in safeguarded accounts — not Wise's own capital. Equity is only £1.4B, which is why headline ROE looks superheroic — but that ratio is not a useful signal for a regulated EMI where minimum-capital rules, not shareholder capital, dictate the asset size.

Capital allocation

Wise pays no regular dividend, and buybacks have historically been small — executed only to offset employee-scheme dilution. That is changing: with FY2025 results management announced a 15p special dividend (roughly £155m at current share count) plus an enlarged £150m buyback programme, signalling capital return discipline is finally engaging now that the rate windfall has built a surplus capital base.

The FY2026 column is the announced step-change — the first time Wise has returned material cash to shareholders. It does not yet show in audited cash flow but is the single most concrete signal the company has stopped behaving like a high-growth start-up and started behaving like a cash-generative listed compounder.

Price action since IPO

Available daily price data covers the last six months only — but it is the most informative window. The stock spent most of late 2025 and early 2026 trading 810–900 GBp before re-rating sharply in April 2026, partly on speculation around the timing of the US dual-listing scheme circular.

The shape matters: a flat 5-month base followed by a 25% breakout into the FY2026 trading update window. That is the market starting to discount a successful US listing combined with H2 FY26 underlying-margin recovery — neither yet confirmed. The key question is whether the recent move is an early read on a fundamental re-rating, or a momentum trade that will give back gains if H2 disappoints.

Valuation — anchored to what Wise actually is

Wise has only 18 months of post-IPO valuation history before the rate tailwind kicked in, so the canonical "20-year history" lens does not exist. The valuation question is framed against the peer set and against rate-normalisation scenarios rather than self-history.

Peer comparison

Wise sits in the sweet spot of the peer table — materially better margins than the other "growth" fintechs (Remitly, Payoneer), materially faster growth than the incumbents (Western Union, PayPal), and a P/E between the two camps. The gap to Remitly is the structural one: Remitly has comparable top-line growth but is barely profitable, which is why it trades at 80x. Wise is the rare name that combines growth and profitability in cross-border payments — and that is most of what the multiple reflects.

Wise's coordinate (15% growth, 34% net margin) is the outlier. No other listed cross-border payments peer prints both numbers at the same time. The debate for an investor is whether the 34% is the sustainable print or a rate-cycle high.

Fair value scenarios

Three lenses, all reasonable, widely different answers. The stock is now pricing the upper-end "base" case after April's rally; the bull case requires both sustained double-digit volume growth and rates staying supportive; the bear case is what happens if interest income normalises faster than operating income can grow into it.

What the numbers say

The numbers confirm that Wise is genuinely a different kind of cross-border payments business — the only listed peer that can simultaneously grow 15% and print 20%+ underlying PBT margins, and it is doing so without meaningful leverage, with conservative capital allocation, and an investment-grade balance sheet. The numbers contradict the framing often applied by bulls that the 34% statutory net margin is the "real" margin — it is not; roughly a third of reported earnings comes from interest income that will compress as rates normalise, and management's own underlying metrics quietly admit this. What to watch next: the H2 FY26 trajectory of underlying PBT — if Wise can pull underlying PBT margin back into the 18–20% range while absorbing US-listing and Assets-product investment, the multiple holds and the bull case opens up; if underlying PBT slides below £250m for the full year while the rate kicker fades, the bear scenario gets priced in fast and the recent April rally unwinds.