Paysafe Reports 7% Revenue Surge Driven by Digital Wallet Adoption
Paysafe, the U.K.-based payments platform, has witnessed a significant increase in revenue attributed to the growing utilization of digital wallets. CEO Bruce Lowthers announced the company’s first-quarter earnings, stating, «We kicked off 2023 by delivering our strongest quarterly revenue since going public» [PYMNTS]. Paysafe reported a 7% rise in revenue, primarily fueled by double-digit growth in digital wallets and eCommerce.
Lowthers expressed confidence in maintaining their full-year outlook and highlighted the success of their sales transformation initiative, which has contributed to cross-selling opportunities and securing high-value clients. Paysafe recorded first-quarter revenue of $387.8 million, a notable increase compared to $367.7 million in the same period last year. Excluding a $7.3 million impact from foreign exchange rate changes, total revenue saw a 7% surge.
The merchant solutions segment experienced an 8% boost in revenue, primarily driven by robust growth in eCommerce and the small- to medium-sized business (SMB) market in North America. Paysafe’s digital wallet revenue increased by 2% on a reported basis and 6% on a constant currency basis. This growth was propelled by underlying expansion in iGaming and digital assets, along with interest revenue generated from customer deposits, which offset the impact of the Russia-Ukraine conflict.
This positive news marks the second consecutive quarter of success for Paysafe. Amidst a period of disappointing earnings results for many FinTech companies, Paysafe emerged as an outlier. The overall sentiment in the industry was affected by this «general malaise» impacting numerous companies in the PYMNTS FinTech IPO Index.
The surge in Paysafe’s revenue coincides with the rising popularity of digital wallets, particularly among millennial consumers. While Generation Z leads in embracing new payment methods, 67% of millennials have already adopted digital wallets. Furthermore, 44% of millennials believe that mobile wallets can replace most or all features of a physical wallet, according to the «Mobile Wallet Challenge: Replacing Physical With Digital» report, a collaboration between PYMNTS and ACI Worldwide. Notably, millennials consistently use the highest number of wallet features, averaging 8.1 features per user.
Paysafe’s impressive revenue growth and the increasing prevalence of digital wallets highlight the evolving payment landscape, driven by shifting consumer preferences and advancements in financial technology. As the company continues to thrive, it exemplifies the potential for success in the digital payment sector.