Remitly's Q4 2025 Earnings Confirm Profitability Amid Growth Deceleration Concerns

What happened

Remitly reported Q4 2025 results, meeting its full-year guidance with revenue around $1.62 billion and adjusted EBITDA of $225-230 million, validating the recent profitability inflection. Management reiterated the 2026 outlook for high-teens revenue growth and adjusted EBITDA of $300-320 million, implying over 30% EBITDA growth but slower top-line expansion than historical rates. Operational metrics remained strong with send volume up 35% year-over-year in Q3, yet take rate compressed to 2.15% due to mix shifts toward lower-margin business and high-amount sender segments. Credit exposure from Flex receivables stayed modest at $21 million with nearly 90% current, though transaction losses have risen, highlighting persistent risk management challenges. The stock showed limited post-call movement as investors weighed durable profitability gains against decelerating growth expectations and ongoing competitive pressures.

Implication

The confirmed 2025 performance underscores Remitly's shift to profitability, but the reduced revenue growth guidance for 2026 limits near-term upside and refocuses attention on execution risks. Maintaining RLTE% near 65% is essential to protect unit economics amid competitive pricing and mix-driven take-rate declines. Flex and other new products must scale without significant credit losses to avoid balance sheet strain and preserve capital for growth initiatives. Success in delivering the 2026 plan could drive shares toward the base case $19, while failures might trigger a bear case down to $11, emphasizing the need for disciplined position sizing. Ongoing monitoring of quarterly KPIs—especially revenue growth, RLTE%, and credit metrics over the next 6-9 months—is critical to reassess the investment case.

Thesis delta

The Q4 earnings call reinforced the base scenario of disciplined growth and margin expansion, but highlighted no material shift in the investment thesis. Persistent take-rate compression and rising transaction losses underscore the need for vigilance on unit economics and credit quality, though management's guidance remains consistent with prior expectations. Remitly stays a potential buy for investors comfortable underwriting execution risk over a 6-12 month horizon, with no change to the rating or conviction level.