Greetings, and welcome to the Euronet Worldwide First Quarter 2026 Earnings Conference Call. Instructions were provided for participants. Please be advised that today's conference is being recorded. It is now my pleasure to introduce your host, Ms. Stephanie Taylor, Head of Investor Relations for Euronet Worldwide. Thank you, Ms. Taylor, you may begin.

Thank you. Good morning, and welcome to Euronet's First Quarter 2026 Earnings Conference Call. On the call, we have Mike Brown, our Chairman and CEO; and Rick Weller, our CFO. Before we begin, I need to call your attention to the forward-looking statements disclaimer on the second slide of the PowerPoint presentation we will be making today. Statements made on this call that concern Euronet or its management's intentions, expectations or predictions of future performance are forward-looking statements. Euronet's actual results may vary materially from those anticipated in these forward-looking statements as a result of a number of factors that are listed on the second slide of our presentation. In addition, the PowerPoint presentation includes a reconciliation of the non-GAAP financial measures we'll be using during the call to their most comparable GAAP measures. Now I'll turn the call over to our Chairman and CEO, Mike Brown.

Thank you, Stephanie. Good morning, and thank you, everyone, for joining. I'll begin my comments on Slide 4. The first quarter here in 2026 represented a solid start to the year as we navigated what continues to be a fluid operating environment. Importantly, we continue to make meaningful progress on our growth initiatives that we believe will position Euronet as a long-term winner in the payments and cross-border space. We are pleased by the broad-based strength across our business, which drove 19% growth in adjusted EPS alongside accelerating momentum in several of our key digital efforts. Highlights include 35% growth in Ria Digital transactions and a 42% growth in new digital customers, the addition of approximately 2,300 new merchants in our Merchant Acquiring business, Dandelion delivering its strongest quarter to date, three EFT payment infrastructure deals signed, and continued expansion of our CoreCard client base. During the quarter, we continued to face headwinds from immigration policy and ongoing economic pressures, and the conflict in the Middle East introduced additional volatility across parts of our business. These impacts were most pronounced within the Money Transfer segment. We believe the softness associated with these factors is transitory, and we remain focused on what we can control: continuing to operate the business efficiently, executing our long-term growth initiatives across all three segments and maintaining financial discipline. We remain confident in our full year outlook, supported by our strong balance sheet and our historically disciplined balanced approach to capital allocation. We believe that we are well positioned to execute against our strategic priorities and deliver adjusted EPS growth in the 10% to 15% range for the full year. Next slide, please, Slide 5. During the first quarter, the EFT team continued to expand our banking and payments infrastructure business with a particular focus on growing the REN platform, our ATM-as-a-Service offering and our merchant acquiring network. As a reminder, these are key offerings within EFT that we believe will play a significant role in accelerating growth at Euronet for years to come. Starting in Europe, in Austria, we implemented an ATM-as-a-Service banking infrastructure agreement with bank99. Under this long-term agreement, Euronet will provide full outsourcing services for bank99's ATM fleet across the country, reinforcing our role as a long-term infrastructure partner to leading banks. In Poland, we signed an agreement with UniCredit Bank to deploy cash recyclers across its branch network. This deployment also allows UniCredit's customers to access Euronet's market-leading depository network. In Latin America, the REN team signed its first banking infrastructure agreement in the region with Banco Itau in Paraguay. This agreement enables the bank to take full ownership and management of its ATM network, allowing it to exit the country's centralized ATM monopoly and then transition to a modern independent processing model with direct scheme connectivity. I want to highlight the strategic importance of these banking infrastructure agreements. Across several European markets and even at an EU level, regulators are developing standards and in some cases, formal regulation that require banks to maintain ATM networks to ensure customer access to cash. By leveraging Euronet's REN technology and scale, banks can meet these requirements while delivering better customer service at a significantly lower cost. For Euronet, these agreements generate long-term recurring revenue and deepen our position as a critical infrastructure provider. In addition to these core platform wins, we continue to expand our product footprint with existing relationships. In Ecuador, we extended our partnership with Banco Guayaquil through a 3D Secure agreement. This is notable for two reasons. First, it demonstrates our ability to cross-sell incremental REN products to existing clients; and second, it represents the first deployment of this product in Latin America, highlighting the cross-geography synergies resulting from our 2024 Infinium acquisition in Malaysia. We also saw continued momentum in merchant acquiring, adding approximately 2,300 new merchants to our existing portfolio. During the quarter, we further strengthened our position in Spain through the announced acquisition of PaynoPain. This transaction enhances our ability to offer digital merchants a comprehensive and flexible suite of omnichannel payment solutions tailored to a wide range of customer needs and industries. Overall, I am pleased with the EFT Group's solid start to the year. Their continued focus on expanding banking and payments infrastructure continues to provide long-term recurring revenue while also providing state-of-the-art technology for banks, merchants and fintechs around the world. With that, let's turn to Slide 6, and we'll discuss epay. During the quarter, epay continued to make steady progress expanding its digital content distribution capabilities across both established and developing markets. We extended our digital content distribution relationship with Revolut into Brazil and Mexico for a total of 22 countries. Revolut is a banking super app and one of the most successful fintech companies in the world with over 65 million global users. This expansion reflects continued demand from global partners to leverage our distribution infrastructure across global markets. We signed and launched a B2B agreement with Apple for distribution through corporate benefits, a leading European employee benefits and rewards platform, across six countries. In Japan, we signed a content distribution agreement with Roblox, adding another global brand to our network. This agreement represents continued progress in expanding epay's presence in key digital entertainment markets. We also advanced our alternative payment initiatives during the quarter. We launched Amazon Paycode in partnership with Italy-based LIS PAY, increasing consumer access to alternative digital payment solutions through additional payment channels. In India, we launched Google Play and Apple Gift Card codes on Zepto, a leading quick commerce platform. This launch expands our distribution of key digital content and supports our strategy of partnering with digital platforms to capture the evolving consumer purchasing trends. Overall, epay continued to execute on its growth strategy during the quarter with incremental expansion across geographies, partners and product offerings. We expect this trajectory to continue as we seek to leverage existing infrastructure into high-growth adjacencies, which we will discuss in greater detail at our upcoming Investor Day. The team remains focused on building its global distribution network to support long-term value creation. Now let's go on to Slide 7, and we'll talk about Money Transfer. In the first quarter, we continued to make progress in our Money Transfer segment, but a few external factors masked these positive developments. Pressure on transactions initiated in the U.S. retail business to countries south of the border remained persistent, largely due to the continued effects of U.S. immigration policy, where the industry has continued to experience a one-two punch of lost customers from deportation and a virtual freeze in replacement immigration. To a lesser extent, we also saw some impact from the geopolitical developments in the Middle East. While these factors affected our reported results for the quarter, we do not view them as indicative of underlying weakness across our global business or long term in nature. While we faced challenges in the physical retail channel, we received benefits in the digital channel. The U.S. immigration policy, combined with a 1% remittance excise tax and our targeted investments in new customer acquisition, resulted in accelerated digital transaction growth of 35%, new customer growth of 42% and digital revenue growth of 42% year-over-year. The average spend per transaction increased approximately 6% and gross profit per transaction improved year-over-year. Dandelion also posted its best quarter on record. So while external pressures remain, we stayed focused on execution, expanding our digital cross-border payments capabilities, including the launch of real-time payment services in nine new markets and continuing to scale the Dandelion network. I want to emphasize an important differentiator in our Money Transfer business: the strength and the scale of our global cross-border payments network. Today, that network reaches more than 4 billion bank accounts, 3.7 billion wallet accounts and more than 4 billion debit card accounts as well as over 600 payout cash locations. The unparalleled reach, speed and product differentiation powers Ria, Dandelion and xe with real-time consumer and corporate payments at lower cost than competitor networks. While cash pickup remains a critical service for a large portion of our remittance consumer base, we continue to see Ria, Dandelion and xe customers gravitate towards the convenience of digital payout. Our account deposit transactions grew 12% this quarter and now represent 44% of the money transfer transactions and 58% of the principal transfer. We see account deposits as the solution to driving long-term sustainable growth in cross-border remittances and payments. During the quarter, we remained focused on expanding digital payout capabilities in key corridors. We made a minority investment in the MIO Wallet, a fintech venture, which enables digital cross-border payout capabilities in the Dominican Republic. We also continued to invest in future-ready payment infrastructure. In partnership with Fireblocks, we established stablecoin rails during the quarter. The initial deployment enhances our treasury management capabilities. Over time, we expect to expand functionality, including enabling our global assets across all three segments to serve as on and off-ramps for stablecoin users. This is important to understand as our ability to operate in a licensed and compliant manner across many countries, particularly in emerging markets, positions us to facilitate stablecoin movement in a way that few fintechs can. Turning to Dandelion, we continue to expand the client portfolio with the launch of two new partners: Master Remit, a leading money transfer operator in Australia and New Zealand; and U-Transfer, a South Korean-based fintech specializing in cross-border remittances and foreign exchange. In addition, we signed agreements with five new clients, further broadening the platform's reach. These additions underscore both the growing demand for Dandelion's capabilities and its role as an increasingly important driver of long-term growth. Overall, the Money Transfer segment made measurable progress during the quarter with a continued focus on disciplined expansion, digital enablement and investment in scalable payment infrastructure. We remain focused on executing against our long-term strategy. With that, I'll turn it over to Rick to walk you through the financial results in more detail.

Thanks, Mike. Good morning, everyone, and thank you for joining us today. I'll start my remarks on Slide 9. We delivered revenue of $1 billion, operating income of $72 million, adjusted EBITDA of $126 million and adjusted EPS of $1.58. Adjusted earnings per share increased 40% from $1.13 in the prior year. Excluding a one-time tax charge of $0.20 per share in the prior year, adjusted earnings per share increased 19% from $1.33. You can see we are on track to meet the guidance range we shared with you earlier in February. Further, this quarter, we continued our track record of producing strong free cash flows. And because we didn't have any large pending acquisitions or other capital requirements, we repurchased $100 million of our shares. Given the timing of the repurchases, there was only a marginal benefit of about $0.02 per share in the first quarter adjusted EPS. But we know this repurchase will continue to support per share earnings in the future. I'll point out that our operating income of $72 million includes $5 million of additional noncash purchase price amortization reflected in the GAAP purchase accounting for the CoreCard acquisition and an additional $3.5 million for noncash share-based compensation. Excluding these two noncash items, our operating income would have grown 7%. Slide 10 shows our first quarter year-over-year results on an as-reported basis. Most of the major currencies we operate in strengthened compared to the dollar. To normalize the impact of the currency fluctuations, we have presented our results adjusted for currency on the next slide. I'm on Slide 11 now. The EFT segment delivered strong revenue growth in the first quarter of 2026 with constant currency revenues increasing 19%, driven by a combination of double-digit growth in REN and merchant acquiring, certain interchange rate increases and the full quarter inclusion of the CoreCard acquisition completed in the fourth quarter of 2025. Morocco, Egypt and the Philippines led the way for the geographical expansion of our ATM footprint, together with deepening our banking outsourcing partnerships. ATM expansion was modest with installed ATMs and active ATMs up 1% after deinstalling approximately 1,400 nonperforming ATMs. In Poland, interchange increased during the first quarter with certain schemes implementing new interchange rates that include both fixed and variable components. These rate increases reflect a similar theme where we have seen rate improvements across Europe. Looking ahead, we expect to continue to see improvements in interchange rates and direct access fees, or DAF, as regulatory requirements evolve across Europe, where approximately 15 countries have implemented formal ATM cash access frameworks. These changes are designed to preserve customer access to cash while supporting the long-term sustainability of ATM networks. As additional bank branches decline, independently owned ATM networks are increasingly filling the gap, enabling banks to lower cost while still meeting regulatory requirements for access to cash. As these trends evolve, we expect pricing structures to adjust to support accessible ATM networks. Adjusted EBITDA increased 12%. Operating income remained relatively flat, largely due to the approximately $5 million increase in noncash purchase price amortization related to the CoreCard acquisition. Absent this $5 million increase, operating income for the segment would have grown 21%. These double-digit operating results reflect the earnings leverage of revenue growth while exercising disciplined expense management. Operating margins were consistent year-over-year after adjusting for the inclusion of the $5 million noncash purchase price amortization. In epay, the segment delivered solid results for the first quarter of 2026 with revenue increasing 2% on a constant currency basis. Operating income rose 13% and adjusted EBITDA increased 12% on a constant currency basis. Results benefited from the absence of a $4.5 million one-time operating tax impact in the prior year first quarter. epay revenue and gross profit per transaction were consistent to improving. In the Money Transfer segment, revenue declined 4% on a constant currency basis. Operating income was $38.9 million and adjusted EBITDA $45 million, both down year-over-year. Total transactions decreased 2% to 43.9 million, while digital transactions grew 35%. New digital customers increased 42% and the network locations expanded 4%. The decline in constant currency revenue was primarily driven by immigration-related pressures impacting transfers between the United States and Mexico, the implementation of a 1% remittance excise tax paid on cash transactions in the first quarter and reduced volumes in the Middle East. These headwinds were partially offset by growth in markets outside the U.S., continued strength in consumer-to-consumer digital transactions and the expansion of our Dandelion cross-border payment network. While constant currency revenue per transaction came in a bit lower, gross profit per transaction improved, driven by a favorable mix toward account-based payouts, improved payout rates and more efficient network routing, highlighting the strength of our cross-border payments network. Operating profit benefited from expanded gross margins, which were reinvested in digital marketing to support long-term growth, resulting in lower operating profit year-over-year. At the consolidated level, despite a more challenging macro environment, we delivered solid earnings growth, supported by strong performance in EFT and continued momentum in our digital channels. While Money Transfer faced near-term pressure, the underlying fundamentals of the businesses remain intact. Turning to the full year guidance. I'd note that as we continue to see the benefits of our key digital growth initiatives, we are seeing a corresponding evolution in our seasonal earnings profile. In the prior year, earnings were more heavily weighted toward ATM tourist activity. As we continue to diversify the business and expand our digital products, we expect the second and third quarters to represent a lighter portion of full year earnings than in the past. As Mike mentioned earlier, our current operating momentum and pipeline of growth initiatives give us confidence in our ability to deliver adjusted earnings per share growth of 10% to 15% in 2026. Let's now turn to Slide 12 for a few brief comments on the balance sheet. As you can see, we ended the first quarter with $2.1 billion in unrestricted cash and ATM cash. Total debt was $2.6 billion at the end of the quarter. The increase in cash and debt was due to an increase in cash in ATMs in preparation for our tourist season in Europe as well as cash generated from operations, partially offset by share repurchases and working capital fluctuations. During the first quarter, we repurchased $100 million of our shares. Share repurchases remain a core component of our capital allocation strategy, funded primarily through our strong recurring operating cash flows. We believe share repurchases have been an effective use of capital and underscore our confidence in the long-term value of the business. Over the past four years, we have returned, on average, approximately 85% of our annual earnings to shareholders through share repurchases, reflecting a strong return of capital to shareholders. Our broader capital allocation framework continues to prioritize maintaining an investment-grade balance sheet, investing in organic growth, pursuing disciplined and strategic M&A opportunities and returning excess capital to shareholders. With this, I will turn it over to Mike to wrap up the quarter.

Thanks, Rick, and thank you, everybody, again. To close, we are pleased with the solid start to this year. We continue to benefit from product and geographic diversity, which allow us to deliver good results despite a complex and uneven macro environment. Our digital initiatives are clearly delivering results. We're seeing accelerating adoption across the business, driving meaningful mix shift and operating leverage. That progress reinforces our confidence in our strategic direction and the investments that we have made to develop an industry-leading global payments network and expand digital access for our customers and partners. At the same time, our core platforms continue to scale globally. Long-term infrastructure agreements, expanding networks and continued partner wins across the portfolio are strengthening the durability and reach of the business. We also remain disciplined on how we allocate capital. We are balancing organic growth and innovation with selective M&A opportunities while continuing to return capital to shareholders in a way that supports long-term value creation. Our balance sheet and cash generation remains strong, providing us with the flexibility to execute and give us confidence in our full year outlook while continuing to build long-term value for our shareholders. Thank you for your time today, and we look forward to seeing you at our Investor Day on May 20. With that, we will open the floor for questions. Operator, will you please assist?

Instructions were provided for the question-and-answer session. Our first question comes from the line of Vasu Govil of KBW.

I guess the first one on the strong acceleration in the EFT segment. Could you help us think through how much was the contribution from CoreCard versus just organic growth in that segment?

Yes. So CoreCard was a little bit variable this time, Vasu. We were able to pick up about $30 million in revenue. However, 40% of that $30 million was card stock purchases in anticipation of issuing lots of cards and that 40% was at almost no margin. It is encouraging that they bought so much card stock because with that contract they're expecting to launch and issue a lot of cards.

Got it. So should we be modeling $30 million less the 40% as we look through the rest of the year in the EFT segment from CoreCard?

Yes. I think that would be reasonable. We'll see how it plays out, but for sure you don't want to count that 40% every single quarter as recurring high-margin revenue.

Got it. And then on the Money Transfer segment, I know there are a bunch of different macro headwinds ongoing. On the U.S.-Mexico corridor, have you seen the headwinds stabilize there or is it still continuing to get worse? And in light of the geopolitical events in the Middle East, what are you seeing in terms of trends in the month of April? That would be super helpful.

Okay. Let me tell you: April is the first month of the new quarter. For the last year, the first month has often been pretty good and then the following months get weaker. I think it would not be prudent to project the quarter based solely on what April does. It's a very choppy environment with a lot of unknowns. We continue to do well in comparison to our competitors, and our digital business is growing rapidly, so we're feeling pretty good about Money Transfer. But anyone who gives you a firm quarter estimate based only on April is going out on a limb.

Our next question comes from the line of Rayna Kumar of Oppenheimer.

I just want to go back to Money Transfer for a second. I see that you're still growing agent locations, I think up 4% in the quarter. What are your expectations going forward on increasing physical locations given the ongoing pressure from U.S. immigration and from the Iran war?

Well, this macro pressure is certainly not in our favor, but it's also not in favor of our competition. We believe we will continue to add more physical locations because some people prefer to transact that way, regardless of whether they pay with a card. We expect continued growth there, and there may be opportunities for us to be aggressive and win agents quickly because we're performing well as a company and competitive pressures have eased relative to the past.

Got it. That's helpful. And then on CoreCard, how is the pipeline looking? It sounds like CoreCard had a strong quarter. How should we think about it for the year?

I said this on the last call: when we bought CoreCard, in our business plan we didn't expect to sign a new deal for the first 18 months because of the typical sales cycle. We've been pleasantly surprised that we're selling new deals now and have a very strong pipeline in process. By the time we get to that 18-month mark, we expect to have a number of deals closed. Our goal is to make sure that by the time the Apple business winds down, which we think will happen sometime after the end of 2027, we've filled that revenue bucket and then some.

Got it. If I can sneak in a modeling question: Rick, how should we think about interest expense for the rest of the year?

Rayna, we have about $700 million of Eurobond that matures in May. We would expect to refinance that maturity with new financing that will probably carry interest costs a couple of hundred basis points higher, so factor that into your modeling and it should be consistent.

Our next question comes from the line of Pete Heckmann of D.A. Davidson.

Interesting dynamic playing out, which has taken some time. In terms of countries looking at ATM fee frameworks, are any of those changes significant to the near-term outlook of your business, particularly Poland where you have a fairly large number of ATMs? Is the change in interchange rates there enough to really move the needle?

Yes. All these deals, whether ATM frameworks or infrastructure plays, are beneficial. Each one moves the needle a bit, and in total they move our results upward. The trend is that as bank branches close across Europe, there's political and regulatory backlash to preserve access to cash. Approximately 15 countries have mandated cash access, with more in the works, and even Switzerland enshrined it in their constitution. Independent providers with scale, like us, are well positioned to be long-term infrastructure partners. Every one of these deals is a good deal and they are accelerating due to the legislative and political environment in these countries.

And Pete, I'd just add that all of that gives us greater confidence in the long-term durability of the business.

Okay. That's helpful. And I missed it on Bilt. For some reason, I was confusing that when you first mentioned it. With Bilt, is that a U.S. card?

Yes, it is. Bilt is a successful U.S. card targeted to customers who rent their housing; they earn extra points and rewards when they use the Bilt credit card to pay their landlords for rent. It's spelled B-I-L-T, if you want to look it up.

Our next question comes from the line of Gustavo Gala of MCH.

I'll keep it to one and a bit long. With Investor Day coming around, you guys have consistently delivered double-digit CAGR on revenue, but multiples continue to compress. Was the Investor Day attendance correct? One of the things that has come up is a time to stop trading implying terminal decline. As part of the Investor Day, is the Board considering any structural actions, anything from a spin-off, strategic review, anything that could help crystallize value?

Well, the Board will consider anything that comes up. We're a publicly held company and must evaluate options. But when you look at our digital initiatives and growth aspirations, we're excited about our direction without any structural action. The broader fintech segment has declined significantly over the last year, and we fell into that vortex with them. Structurally, we've got a growing business, and while we have challenges with U.S. immigration policy impacting money transfer, that business continues to grow well in other markets. We have an unparalleled network and the ability to sell infrastructure deals widely. We're not planning aggressive structural changes at this time. With many growth drivers and accelerators, we'll keep adding to the bottom line and continue disciplined acquisitions. If acquisitions aren't available, we will continue to consider share buybacks as we've done in the past.

Our next question comes from the line of Mike Grondahl of Northland.

Two questions. One, could you talk about the double-digit revenue growth you saw at REN and merchant acquiring; what's driving that? And secondly, have you seen any effect of $100 oil in your end markets or customer activity?

I'll answer the oil question first. The Middle East volatility has affected our Middle East money transfer transactions, but we haven't seen a direct effect from $100 oil yet. We consider second-order impacts like inflation and potential reduced consumer spending, but no direct effect so far. On REN and why it's growing: REN continues to do well and is accelerating. When we started REN, much of it was in Asia. Now we're signing deals globally. REN is modern technology and many banks lack modern processing; they need reference customers in their geographies. We're getting more reference customers and more deals as a result.

Adding to that, over the years we've added product functionality to REN. It began as a switching product, and we've added capabilities like 3D Secure and other offerings that map into bank payment infrastructure needs. The addition of complementary products and the momentum from longer sales cycles is now producing results. We also get leverage across segments, selling to customers we have relationships with in multiple areas, so that combination is driving the momentum.

We also have a couple of items we'll highlight at Investor Day showing how we've leveraged REN into new verticals with significant growth potential. More to come there.

Our next question comes from the line of Josh Levin of Autonomous Research.

Two questions. First, your competitor Western Union said the Middle East was actually a source of strength for money transfer, meaning the war spurred higher transfer activity. It sounds like you had the opposite experience. How might we reconcile those comments? Second question: you launched stablecoin payouts. Can you give us some sense of the specific unit economics for stablecoin transactions compared to a traditional FX-based remittance?

On the stablecoin question, the primary advantage for us now is treasury float. In traditional money transfer, we prefund correspondent banks in advance for payouts, which creates float. With stablecoin rails, we can reduce that prefunding need and make settlement more ad hoc and closer to instantaneous, which improves treasury efficiency. As we improve functionality, stablecoins could further reduce float and settlement time. Regarding the Middle East comment from Western Union, differences may be country-specific. We don't have as large of a Middle Eastern payout footprint as they do, so they may have seen increased activity in countries where they have exposure and we do not.

At the consumer level, stablecoin economics vary widely. Large transactions can have very low basis-point costs, but consumer-level transactions can have on-chain costs of 3% to 4% to 'get on' and 3% to 4% to 'get off' the chain. That can result in total chain costs of 6% to 8% in some cases. In the traditional money transfer industry, consumer costs are often sub-3% total. So at the low end today, stablecoin transactions are not necessarily more economical than traditional rails for consumers. The important point is that we have the technology and one of the best global networks to provide on- and off-ramps as use cases develop.

Also, there may be certain corridors where Western Union has specific volume concentration, like Iraq, where they have payout capabilities we don't. That can make their Middle East results look stronger relative to ours in certain periods.

Our next question comes from the line of Cris Kennedy of William Blair.

Mike, you mentioned Dandelion had one of its strongest quarters on record. Can you provide a little more color on those comments?

We have a couple of large customers and many smaller ones on Dandelion. I can't disclose specifics because that would disadvantage us competitively as we bring on new customers. What I can say is we saw strong double-digit growth; it was our best quarter ever. Dandelion tends to set new records as more customers adopt it; every quarter is typically larger than the last as banks and partners roll out the product to more of their customer base.

Continuing the point on momentum similar to REN, Dandelion's sales cycles are long, but we're beginning to see the momentum build from that focus and the wins we've had. We mentioned a number of wins in the prepared remarks, and as our sales success continues, we'll continue to see the business perform well.

As an example, HSBC was an early big bank customer, and each month tends to be a record for them as they scale usage. It takes time for large banks to market the capability to their customers, but as they gain confidence, they expand usage, and we benefit from that ramp.

Understood. Rick, you mentioned drivers of improving gross margin in Money Transfer. Can you speak to the sustainability of gross margins in that segment?

Yes. I would expect continued improvement. It speaks to the strength of our network and our volume, which gives us greater ability to negotiate rates with payout agents. The larger our network, the more routing choices we have and the more transactions move to account-based payouts, which are lower cost. Account-based payouts can be bank accounts or wallet accounts, and those are typically lower cost structures. I think we'll continue to see the benefit of the network we've built.

Operator, do we have any more questions? If not, we can close—oh, we have one more, I think. Is that right, Operator?

Yes. We have one more question. I'll go ahead and bring them up now. We welcome Darrin Peller with Wolfe Research.

Can you hear me okay?

Yes, perfectly.

One question on the margin structure and expectations in the Money Transfer segment. I recall you expected 50 to 70 basis points of margin improvement in the year with some restructuring to help that. I noticed margins were down year-over-year now. What's your conviction on that front? And more broadly, how do you think about approaching that segment given the political environment and migration that could persist?

On margins, Darrin, we expect improvement to be somewhat back-end loaded. As we entered the year, several programs were being implemented and some of the expense to implement them was front-loaded, so the benefits should deliver more on the back end of the year. Broadly on the industry, immigration trends ebb and flow with politics over time, but migration is a long-term dynamic. Developed countries are a minority of the global population, and people often move to improve their situations and send money home. We are seeing the impact of a different political environment now, but we expect that over time immigration and remittance flows will continue. We saw growth outside the U.S., and we believe the market for sending cross-border money remains large and attractive with good margins. While there are short-term challenges, we have a durable, diversified business that lets us weather these environments.

You've seen our results over the last year where we've outgrown competitors and picked up market share, so as conditions normalize in the U.S., we'll be in a stronger position, and we continue to grow overseas.

Okay. That's helpful. Mike, I may have missed this earlier, but a quick follow-up on the Iran conflict: what implications on travel are you seeing, and what impact is that having on the EFT segment?

So far we haven't seen a material impact. There are concerns about potential flight cancellations if fuel logistics become constrained for the summer, but that's uncertain. One effect we've observed is that Europeans who might have traveled to destinations like Dubai or Turkey may choose to stay closer to home, taking shorter flights or trains. Since roughly 75% to 80% of our cross-border transactions in Europe come from Europeans traveling within Europe rather than visitors coming into Europe, that could be a net benefit for us if more people vacation closer to home.

Yes, what Mike said: there may be an opportunity rather than a challenge in that scenario.

Thank you, Darrin, and thank you, everyone, for joining us today. We'll sign off.

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.