Remitly (RELY) Q1 2025: High-Value Send Volume Jumps 45%, Expanding Profit Flywheel

May 7, 2025 | By EarningsIQ Research

Remitly’s Q1 saw a decisive acceleration in high-value send volume, up 45%, fueling both revenue outperformance and margin expansion. The company’s digital-first model and direct payment integrations continue to drive retention and cost advantage, while innovation in risk management and product adjacencies are unlocking new customer segments. With guidance raised and a prudent outlook, Remitly is leaning into its platform strengths even as macro risks persist.

Summary

• High-Value Senders Drive Growth: Sophisticated risk management and tailored limits unlocked a surge in large-amount transactions.
• Digital Platform Efficiency: Direct integrations and AI-powered customer service compressed costs and supported record customer satisfaction.
• Strategic Diversification: Remitly is broadening corridor reach and customer use cases, reducing reliance on any single market or segment.

Performance Analysis

Remitly delivered a 34% year-over-year revenue increase in Q1, with adjusted EBITDA margin surpassing 16%, marking a “rule of 50” quarter that combines high growth with profitability. Send volume grew 41% to $16.2 billion, outpacing revenue growth as the company leaned into high-value senders and micro-business customers—segments that transact less frequently but at materially higher amounts. This shift drove a 9% increase in send volume per active customer, the highest since 2021, and was enabled by enhancements in machine learning-powered risk models and frictionless transaction processing.

Geographic and product diversification further underpinned results. U.S. revenue rose 35%, while the rest of world grew 41%, and non-top-three receive countries (outside India, Philippines, Mexico) posted 45% growth. On the cost side, Remitly achieved significant leverage: marketing spend per active user fell 17% year-over-year, and customer support and operations expense as a percentage of revenue improved by 89 basis points, aided by AI-driven customer service and product improvements. Transaction expenses and technology spend also saw efficiency gains, supporting a second consecutive quarter of GAAP profitability.

• Mix Shift to High-Value Transactions: Send volume from transactions above $1,000 accelerated, raising overall send volume per user and supporting long-term RLTE (revenue less transaction expense) growth.
• Direct Integration Payoff: Over 93% of transactions were dispersed in less than an hour, and 95% completed without customer support contact, reflecting operational excellence.
• Marketing Efficiency: Word of mouth and targeted campaigns drove new customer additions while reducing acquisition costs, with marketing spend per user declining for the third consecutive quarter.

Remitly’s operational discipline and digital-first approach are generating compounding advantages, reinforcing its platform economics and enabling continued investment in product innovation and corridor expansion.

Executive Commentary

Strategic Positioning

1. Unlocking High-Value and Micro-Business Senders

Remitly’s tailored risk management and machine learning-based send limits have opened the door to high-value senders, a segment previously constrained by rigid transaction caps. Send volume for transactions above $1,000 grew over 45%, and the company highlighted the largest single transfer in its history this quarter. Early traction with micro-business customers—who send larger amounts per transaction—further supports the trend toward higher average send sizes and long-term customer value.

2. Direct Integrations and Digital-Only Model

Direct integrations with local payment partners and banks in corridors such as Nigeria, Peru, Chile, and Egypt are driving both speed and reliability. More than 93% of transactions are now dispersed within an hour, and 99.99% uptime was achieved. The digital-only approach also enables advanced compliance and KYC (know your customer) processes, reducing fraud risk and operational overhead compared to legacy, cash-based providers.

3. Geographic and Use Case Diversification

Remitly is intentionally reducing corridor concentration risk by expanding its global footprint and adding disbursement options like Orange Money and Vodafone Cash. Revenue from regions outside India, Philippines, and Mexico grew 45%, and the company is rolling out new pay-in methods in markets like Canada and Australia. The WhatsApp Send integration, initially focused on Latin America, is positioned to accelerate customer acquisition from offline channels and deepen engagement among existing users.

4. Compliance and Trust as Differentiators

Compliance and trust remain central to Remitly’s value proposition. The company’s centralized, digital-first compliance infrastructure enables rapid onboarding, robust anti-fraud screening, and efficient regulatory adherence across 170 countries. These controls not only reduce risk but also lower operational costs, creating a virtuous cycle that supports reinvestment in growth and customer experience.

Key Considerations

This quarter’s results reinforce Remitly’s thesis that digital remittance is both resilient and highly leverageable, especially as the company captures higher-value use cases and expands its reach. The following factors are shaping the forward trajectory:

• Send Volume Outpaces Revenue: Larger average transaction sizes are driving send volume growth faster than revenue, reflecting a mix shift that supports RLTE expansion but may pressure take rates in the short term.
• Marketing ROI and Word of Mouth: Declining acquisition costs, supported by organic growth and targeted campaigns, are compounding profitability and customer retention.
• Product Innovation Cycle: Initiatives like WhatsApp Send and Remitly Circle are enabling rapid iteration and adjacent product development, with early signals of product-market fit in micro-business and fund storage use cases.
• Operational Leverage: AI-driven customer service and automation are delivering cost efficiencies across support, technology, and G&A, while maintaining high customer satisfaction and regulatory compliance standards.

Risks

Macro uncertainty, including tariffs and geopolitical tensions, remains an ongoing risk factor, though remittances have historically proven resilient across cycles. Competitive intensity from both digital and legacy cash-based providers could pressure margins or slow share gains, especially as Remitly enters new corridors. Regulatory complexity across 170 countries requires constant vigilance and investment, with any compliance missteps posing reputational and operational risks. Finally, the mix shift toward larger transactions, while positive for volume, may introduce volatility in take rates and transaction loss rates.

Forward Outlook

For Q2 2025, Remitly guided to:

• Revenue of $383 to $385 million, representing 25% to 26% growth
• Adjusted EBITDA of $45 to $47 million, translating to a 12% margin

For full-year 2025, management raised guidance to:

• Revenue of $1.574 to $1.587 billion, with adjusted EBITDA of $195 to $210 million (12% to 13% margin)

Management emphasized continued investment in marketing and technology, prudent guidance amid macro uncertainty, and confidence in cohort-driven revenue durability. Key drivers remain high-value senders, corridor expansion, and operational efficiency.

• Send volume growth expected to outpace revenue, driven by transaction size and frequency
• Marketing spend per active user to stabilize in the second half as year-over-year comps toughen

Takeaways

Remitly’s Q1 results highlight the compounding advantages of a digital-first, diversified remittance platform, with high-value senders and operational leverage driving both growth and profitability.

• Platform Flywheel Accelerates: Direct integrations, risk-based transaction limits, and word of mouth are reinforcing customer retention, cost efficiency, and send volume growth.
• Strategic Diversification Reduces Risk: Broader corridor reach and new use cases are lowering dependence on any single market and unlocking incremental growth opportunities.
• Watch for Take Rate Dynamics: As large transactions and business use cases scale, investors should monitor the impact on take rates and margin mix, alongside continued investment in compliance and product innovation.

Conclusion

Remitly’s Q1 2025 demonstrated that digital remittance is not only resilient but also highly scalable, with high-value senders, operational efficiency, and corridor diversification driving both top-line and margin expansion. The company’s raised outlook signals confidence in its durable business model, even as it invests for long-term growth.

Industry Read-Through

Remitly’s results reinforce the thesis that digital-first remittance models are gaining share against legacy cash-based providers, especially as high-value and business senders migrate online. The ability to leverage AI and direct integrations for speed, compliance, and customer experience is becoming table stakes in cross-border payments. For peers, the trend toward larger, more sophisticated senders and the importance of corridor diversification are clear. Regulatory rigor and operational leverage remain critical differentiators as the industry navigates macro and competitive volatility. Players unable to match Remitly’s pace of innovation and efficiency may see share erosion, particularly in high-growth corridors and use cases.

RELY Financials Payments Digital Remittance Compliance Profitability Growth