Euronet Worldwide, Inc. (NASDAQ:EEFT) Q4 2023 Earnings Call Transcript

Michael Brown: I think it’s just the general economics there. And — which is probably most of it.

Rick Weller: And we had some — you may recall in the third quarter, we talked about some FX movements in Pakistan that were irregular that drove the transactions from above the table to below the table in the black market. We saw that kind of rightsize itself. So that helped a little bit. But then as Mike says, it’s just kind of standard marketing activity out there. But that Pakistan was only the only real call out in there.

Unidentified analyst: If I could just squeeze in a follow-up here. Regarding the EFT segment price increases, I’m wondering if you could provide more color on the opportunity there?

Michael Brown: Well, it’s just what we said before, over last year, there were four countries that either improved interchange or allowed surcharge that were not allowed in the prior year. There are a number of countries discussing both of these issues right now. So if any of them — we never know when they’re going to come to a head. But when they do, you get the automatic step function in profit when they do. So that’s what we’re looking at.

Rick Weller: And let’s take a look at the dynamics of this structure in payments world out there. Interchange is at fixed rate kind of a thing as our surcharges in many respects. But look what’s happened with the inflationary costs over the last few years, rents up, cash delivery is up, maintenance is up, labor costs are up. If the numbers on the cost side are up across the board, yet we can’t just go out and raise the interchange rate. So it’s not just us, but banks around the world are feeling this very significantly, and there’s a lot of discussions underway on how the banks are going to improve that revenue stream to be able to cover the cost. And so as those discussions take place, we’ve seen that kind of creep into the picture more and more over the last few years. And those discussions are live and well, we expect that they will continue. So there has to be some rate improvement just to cover the increased costs over the last few years.

Michael Brown: Point is, it isn’t just us who wishes these numbers to go up. We’re actually in conjunction with the banks as far as our thought process. But with that, I think we’re going to end our call today, I want to thank everybody for your time on the call, and I look forward to talking to you next quarter. Thank you.

Operator: Thank you for your participation in today’s conference. This does conclude the program. You may now disconnect. Everyone, have a great day.