Remitly (RELY) Q4 2025: High-Amount Sender Volume Up 40% as Platform Mix Drives Margin Leverage
Remitly’s fourth quarter showcased a decisive shift toward high-amount senders and business customers, with volume mix and AI-led cost discipline propelling record profitability and free cash flow. New product momentum and a CEO transition set the stage for accelerated platform expansion, as management signals a deliberate push into higher-value customer tiers and embedded financial services. Investors should watch for execution on product velocity and geographic expansion under new leadership.
Summary
- High-Amount Sender Growth: Strategic focus on larger transactions is transforming unit economics and platform scale.
- AI-Driven Operating Leverage: Cost discipline and automation are expanding margins while enabling product innovation.
- Leadership Shift: Incoming CEO brings deep product and AI expertise to accelerate Remitly’s multi-product ambitions.
Performance Analysis
Remitly delivered a standout Q4, with send volume up 35% and high-amount sender volume surging 40% year over year. This shift in customer mix, with high and very high amount senders now comprising nearly half of total volume, is fundamentally altering the company’s revenue composition and unit economics. The U.S. remained the primary growth engine, but Rest of World revenue also accelerated, reflecting geographic diversification and traction in markets like the UAE.
Profitability sharply improved, with adjusted EBITDA margin reaching a record 20% in Q4 and full-year free cash flow tripling versus the prior year. AI-enabled fraud prevention and operational automation played a pivotal role, driving transaction losses to record lows and supporting leaner expense ratios across marketing, tech, and support. New products—Remitly Business, Flex (send now, pay later), Wallet & Card, and Remitly One membership—remain a small revenue contributor (just over 1% in 2025), but are positioned to more than double in 2026 as adoption scales.
- Mix Shift to Larger Senders: High and very high amount senders now drive nearly 50% of platform volume, up over 350bps YoY, reshaping Remitly’s revenue base.
- AI-Enabled Cost Reduction: Fraud loss rates hit historic lows (7.3bps), while AI-driven agent automation and treasury optimization improved margins.
- New Product Traction: Flex doubled sequentially in revenue, Remitly Business surpassed 15,000 customers, and Wallet adoption is building, though still early in revenue impact.
Remitly’s disciplined marketing and expense management, combined with the operational benefits of scale and AI, have created a virtuous cycle supporting both growth and profitability. The business enters 2026 with strong momentum and a clear path to leverage its platform for continued expansion.
Executive Commentary
"Our exceptional performance in 2025 was underpinned by three things. First, strength in our core money movement product. Second, early contributions from new products, which enable our long-term vision of becoming a leading and trusted provider of financial services that transcend borders. And third, efficiency gains and operating leverage, which drove record levels of adjusted EBITDA, GAAP profits, and free cash flow."
Matt Oppenheimer, Co-Founder and Chief Executive Officer
"AI is a big tailwind for this business. For me personally, the timing is very good. I have a data and science background and have been deep in the evolution of AI. I believe AI will be transformative, and I also believe incumbents with established business models and happy customers are going to be huge beneficiaries of AI. I'm going to aggressively lead that journey at Remit."
Sebastian Gunningham, Incoming Chief Executive Officer
Strategic Positioning
1. Platform Scale and Customer Mix Evolution
Remitly’s core business is digital cross-border money movement, facilitating remittances for over 9 million active users. The platform’s shift toward high-amount senders is driving higher average transaction values and improved retention, positioning Remitly to capture a larger share of the $22 trillion global TAM (total addressable market).
2. Embedded AI and Automation as Structural Levers
AI is now woven deeply into Remitly’s operating model, from fraud detection and customer support to treasury and product development. These systems are not just cost reducers, but enablers of faster product iteration and improved customer outcomes, supporting both growth and margin expansion.
3. New Product Expansion and Diversification
Remitly is moving beyond core remittances with products like Flex (send now, pay later), Remitly Business, Wallet & Card, and the Remitly One membership. While these offerings are early in their revenue contribution, management expects them to comprise 5-10% of revenue by 2028, providing diversification and deepening customer relationships.
4. Geographic and Segment Expansion
The company is scaling in new markets (notably UAE and soon Japan and Saudi Arabia) and targeting small and medium business customers, whose transaction sizes are roughly double those of consumers. This multi-pronged expansion is designed to unlock new revenue pools and reduce concentration risk.
5. Leadership and Execution Focus
The CEO transition to Sebastian Gunningham, with a track record at Amazon and Santander, brings a product-first, AI-driven operational discipline. The board and outgoing CEO are emphasizing continuity and acceleration, not reinvention, with an explicit mandate to increase product velocity and execution quality.
Key Considerations
Remitly’s Q4 and full-year results mark a pivotal inflection in both business mix and operational discipline, but the next phase will test the platform’s ability to scale new products and geographies while sustaining margin gains.
Key Considerations:
- Mix Shift Sustainability: High-amount sender and business customer growth is driving margin leverage, but sustaining this mix will require ongoing product and compliance investments.
- AI as a Competitive Moat: Remitly’s AI investments are yielding tangible cost and efficiency gains, but competitors may accelerate their own adoption, narrowing the advantage.
- New Product Adoption Curve: Early traction in Flex and Remitly Business is promising, but scaling these to meaningful revenue share will require cross-sell, geographic rollout, and regulatory navigation.
- Leadership Transition Risk: The CEO handoff is well-planned, but execution risk remains as the new leader aligns teams and priorities for accelerated delivery.
Risks
Remitly faces macro and regulatory headwinds, including FX volatility, changing remittance tax regimes, and evolving immigration policies. While the business demonstrated resilience and outperformance in a challenging environment, further geographic expansion and new product launches may expose the company to compliance, operational, and credit risks. The competitive landscape in digital remittances and cross-border payments remains intense, with both fintechs and incumbents investing in similar AI and platform capabilities.
Forward Outlook
For Q1 2026, Remitly guided to:
- Revenue of $436 to $438 million, representing 21% YoY growth
- Adjusted EBITDA of $82 to $84 million, or ~19% margin
For full-year 2026, management guided to:
- Revenue of $1.94 to $1.96 billion (19-20% growth)
- Adjusted EBITDA of $340 to $360 million (~18% margin)
Management highlighted:
- High visibility into 2026 revenue from prior year cohorts, supporting confidence in guidance despite macro uncertainty.
- New product revenue contribution expected to more than double, led by Flex and Remitly Business.
Takeaways
- Mix Shift Drives Margin Expansion: The deliberate focus on high-amount senders and business customers is structurally improving unit economics and profitability, with AI amplifying these gains.
- Execution Discipline Underpins Results: Rigorous cost control and operating leverage allowed Remitly to deliver record profitability and free cash flow, while investing in new product and geographic bets.
- Product Velocity and Leadership Transition in Focus: The incoming CEO’s mandate is to accelerate product development and scale new offerings, making execution on these fronts the key watchpoint for 2026 and beyond.
Conclusion
Remitly’s Q4 capped a transformative year, marked by a profitable mix shift, operational discipline, and the early seeds of platform diversification. The CEO transition, with a clear product and AI focus, positions the company to pursue its $3 billion revenue ambition, but future performance will hinge on the pace of new product scaling and geographic expansion.
Industry Read-Through
Remitly’s results reinforce the digital remittance sector’s shift toward higher-value, digitally native customer segments and the growing importance of AI-driven operational leverage. As incumbents and fintechs race to embed automation and expand cross-border offerings, the ability to capture high-amount senders and business flows will be central to margin and share gains. The company’s disciplined marketing and product-led expansion provide a template for peers aiming to balance growth and profitability in a volatile macro environment. Watch for similar mix shifts and AI adoption trends among global payments and cross-border fintech players in 2026.