Payoneer Global Inc.

NOTE 1 – GENERAL OVERVIEW

Unless the context otherwise requires, the “Company”, “Payoneer”, “we,” “our,” “us” and similar terms refer to Payoneer Global Inc.

Payoneer, incorporated in Delaware, empowers global commerce by connecting businesses, professionals, countries and currencies with its diversified cross-border payments platform. Payoneer enables small and medium-sized businesses (“SMB(s)”) around the globe to reach new audiences by reducing the complexity of cross-border trade, and facilitating seamless, cross-border payments. Payoneer offers its customers the flexibility to pay and get paid globally as easily as they do locally. The Company offers a global financial stack that includes cross-border AR/AP capabilities and includes services such as funds management, working capital, multicurrency accounts, and workforce management. The fully-hosted service includes various payment options with minimal integration required, full back-office functions and customer support offered.

The Company supports customers that come from more than 190 countries and territories and operates in a rapidly evolving regulatory environment. Government regulations impact key aspects of the Company’s business in markets in which the Company operates.

Payoneer is registered as a Money Service Business with the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) and licensed as a Money Transmitter under the laws of all U.S. states where such license is necessary for its business, as well as in the District of Columbia, Puerto Rico and the U.S. Virgin Islands. In 2015, the Company, through Payoneer Hong Kong Limited, was granted a Money Service Operator License in Hong Kong which enables the Company to offer payment services from Hong Kong. In 2016, the Company, through Payoneer Japan Limited, was registered as a Funds Transfer Service Provider in Japan. In 2018, the Company, through Payoneer Australia Pty Ltd, was registered as a Financial Services Licensee in Australia. In 2019, the Company, through Payoneer Europe Limited, was granted authorization to operate as an Electronic Money Institution from the Central Bank of Ireland and was then authorized, pursuant to EU passporting rules, to provide payment services under its license in all countries in the European Economic Area. Payoneer Europe Limited also holds a license with Mastercard to issue cards. In January 2021, Payoneer entered into an agreement with an existing card issuing partner in the United States that enables Payoneer to provide its customers with access to commercial Mastercard cards issued through the card issuing partner to make online purchases of commercial goods and services. In 2023, the Company, through Payoneer Payment Services (UK) Limited, was granted authorization as an Electronic Money Institution from the Financial Conduct Authority of the United Kingdom, and through Payoneer Singapore Private Limited, was granted a Major Payment Institution License from the Monetary Authority of Singapore. In 2025, the Company obtained a payment business license issued by the People’s Bank of China through the acquisition of PayEco Finance Information Holding Corporation (“PayEco”), the parent of a local licensed entity, now called Payoneer Payments (Guangdong) Co., Ltd. In addition, recently, Payoneer India Private Limited was granted in-principle authorization from the Reserve Bank of India as a Payment Aggregator Cross Border (Inward and Outward transactions).

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES

The accompanying consolidated financial statements are prepared in accordance with Generally Accepted Accounting Principles (“GAAP”) in the United States of America (hereafter – U.S. GAAP) and include the accounts of Payoneer Global Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Investments in an entity where the Company has the ability to exercise significant influence, but not control, over the investee are accounted for using the equity method of accounting.

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include, but are not limited to, allowance for capital advance receivables, income taxes, goodwill, indefinite-lived intangibles, revenue recognition, stock-based compensation, contingent consideration associated with M&A, and loss contingencies.

The functional currency of the Company is the U.S. dollar (“dollar” or “$”). Where the Company’s foreign subsidiaries derive their revenue primarily from services provided to the parent company as well as obtain their financing from the parent company in dollars, the Company has determined the functional currencies to be the dollar as well.

Accordingly, monetary accounts maintained in currencies other than the dollar are re-measured into dollars in accordance with the principles set forth in ASC 830,Foreign Currency Translation.

Balances in non-dollar currencies are translated into dollars using historical and current exchange rates for non-monetary and monetary balances, respectively. For non-dollar transactions reflected in the consolidated statements of comprehensive income, the transaction date exchange rates are used. The resulting transaction gains or losses are recorded as other financial income or expense. The Company recognized $13,169 of such transaction losses during the year ended December 31, 2025. Depreciation, amortization and other changes deriving from non-monetary items are based on historical exchange rates.

Certain of the Company’s foreign subsidiaries acquired in the Skuad Pte. Ltd. (“Skuad”) acquisition use the local currency of the respective country of domicile as their functional currencies. Assets and liabilities of these non-U.S. dollar functional currency subsidiaries are translated into U.S. dollars at the period-end rate of exchange. Revenues, costs, and expenses of the non-U.S. dollar functional currency subsidiaries are translated into U.S. dollars using transaction date exchange rates. Gains and losses resulting from these translations are recorded as a component of other comprehensive income (“OCI”). Gains and losses from the remeasurement of foreign currency transactions into the functional currency are recognized as other financial income or expense in the consolidated statements of comprehensive income.

The Company applies the provisions of ASC 820,Fair Value Measurements and Disclosures (“ASC 820”), regarding fair value measurements for assets and liabilities. ASC 820 defines fair value, establishes a framework for measuring fair value and requires certain disclosures about fair value measurements. The provisions apply whenever other accounting pronouncements require or permit fair value measurements.

Fair value measurements used in the consolidated financial statements are based upon the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:

Level 1— Unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2 — Valuations based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities.

Level 3 — Unobservable inputs in which little or no market activity exists, therefore requiring an entity to develop its own assumptions about the inputs that market participants would use in pricing.

As of December 31, 2025 and 2024, the fair values of the Company's cash, cash equivalents, customer funds (other than the portion consisting of available-for-sale debt securities), restricted cash, accounts receivable, capital advance receivables, accounts payable, and outstanding operating balances approximated the carrying values of these instruments presented in the Company's consolidated balance sheets because of their nature.

The Company is exposed to foreign currency risk due to operating expenses denominated in New Israeli Shekels. To reduce that risk, the Company enters into foreign currency forward contracts and net purchased options to hedge foreign currency risk related to its foreign operations in Israel. Additionally, the Company is exposed to interest rate risk on fluctuations in interest income due to floating rate assets in its investment portfolio. To reduce that risk, the Company has purchased interest rate floors to mitigate interest rate risk on a portion of future cash flow revenues associated with these floating rate investments. The Company does not use derivative financial instruments for trading or speculative purposes.

The Company designates derivatives as hedges of forecasted transactions (“cash flow” hedges) or derivatives that do not qualify for hedge accounting. To qualify for hedge accounting treatment, a derivative must be highly effective in mitigating the designated risk of the hedged item. Effectiveness of the hedge is formally assessed at inception and throughout the life of the hedging relationship. The Company evaluates the effectiveness of derivative contracts on a quarterly basis by comparing the critical terms of the derivative instruments with the critical terms of the forecasted cash flows of the hedged item; if the critical terms are the same, the Company concludes the hedge will be perfectly effective. The Company does not exclude any component of the changes in fair value of the derivative instruments from the assessment of hedge effectiveness.

To the extent that derivatives qualify as cash flow hedges, changes in the fair value are recorded, net of applicable taxes, in OCI and subsequently reclassified into the same statement of comprehensive income line item as the hedged exposure when the underlying hedged item is recognized in earnings.

Derivatives that are not designated hedges are adjusted to fair value into earnings through financial income or expense. The cash flows associated with these derivatives, if any, are reported in cash flows from investing activities.

Where the Company is party to master netting arrangements, as is the case for interest rate derivative instruments, it offsets the fair value of derivative assets, liabilities, and related collateral balances in its consolidated balance sheet. In the consolidated statements of cash flows, the Company treats cash payments and receipts on collateral as investing cash flows when the collateral account is in an asset position, and as financing cash flows when the collateral account is in a liability position.

The Company was required to pay a premium related to the interest rate derivative instruments discussed above – this premium is amortized over the life of the instrument and is recognized in the same statement of comprehensive income line item as the hedged exposure. Cash flows related to the premium are included in cash flows from investing activities in the consolidated statements of cash flows.

f. Cash and cash equivalents and restricted cash:

The Company considers cash invested in short-term bank deposits (up to three months from date of deposit) that are not restricted to withdrawal or use and money market instruments, to be cash equivalents. The Company maintains cash and cash equivalent balances with various institutions, which may include banks, payment service providers, or other financial institutions. The Company regularly reviews investment concentrations of these institutions and has relationships with a globally diversified group of service providers.

The Company defines restricted cash as cash held as collateral for the purpose of maintaining compliance with certain agreements, deposits held with payment processors and issuing banks that assist the Company in executing payment transactions, deposits in connection with regulatory requirements, deposits related to hedging activities, term deposits, proceeds from employee equity transactions to be remitted to employees, and deposits for property rental in different locations around the globe. The classification of restricted cash between current and non-current assets depends on the expected duration of the underlying activity.

The Company holds all customer balances, including Payoneer Workforce Management reserves amounts, as direct claims against the Company and reflects them as outstanding operating balances on the consolidated balance sheets. For Payoneer Workforce Management, the Company collects reserve amounts when personnel is onboarded under a customer engagement to secure future customer payment obligations, including those arising from personnel engagements. When the customer relationship or the applicable engagement is terminated, the reserve is refunded, subject to the Company’s right of setoff outstanding fees or amounts.

The Company does not commingle customer funds in accounts dedicated for holding corporate funds. In certain jurisdictions, the Company may be restricted as to the types of accounts in which customer funds may be maintained and as to the types of assets that may be held.

Customer funds include funds in transit that have not yet settled with the designated payee bank account or have yet to be loaded to a customer card or account. These funds are classified on the consolidated statements of cash flows as investing activities.

The Company maintains dedicated interest and non-interest bearing bank accounts for the holding of customer funds, and has invested certain funds underlying customer balances in available-for-sale debt securities and term deposits. The Company classifies the assets underlying the customer funds as current or non-current based on the maturity of the investment in which they are held.

Investments in available-for-sale debt securities are reported at fair value, net of any unamortized discount or premium, accrued interest, and unrealized gains and losses, within Customer funds on the Company’s consolidated balance sheets. Unrealized gains and losses are included as a component of OCI, net of related estimated tax provisions or benefits. Interest income, amortization of any discount or premium, and realized gains and losses on these securities are recognized within revenue from other sources on the consolidated statements of comprehensive income. In the period of sale, any unrealized gain or loss previously recognized in accumulated other comprehensive income (“AOCI”) is reversed into net income. Purchases, maturities, and sales of debt securities are classified as investing activities.

The Company accounts for purchases and sales of securities on the trade date and recognizes any related cut-off asset or liability within Other current assets or Other payables, respectively, on the consolidated balance sheets.

Investments in term deposits are accounted for as restricted cash, given that the Company’s ability to withdraw the balances is restricted during the term of the deposit agreement. $11,031 and $13,766 in accrued interest on term deposits was included in Other current assets and Other assets, respectively, as of December 31, 2025. Interest income is recognized within revenue from other sources on the consolidated statements of comprehensive income, and the balances are included within Customer funds on the consolidated balance sheets. Similar to investments in debt securities described above, purchases and maturities of term deposits are classified as investing activities and as such, are excluded from the basis of cash, cash equivalents, restricted deposits, and customer funds on the consolidated statements of cash flows.

The Company records receivables when services are transferred to customers in exchange for a right to receive consideration, conditional only upon the passage of time. The Company periodically assesses and evaluates the collectability of outstanding receivables and maintains an allowance for expected credit losses related to accounts receivable.

The Company enters into transactions with pre-qualified sellers in which the Company purchases a designated amount of future receivables for an upfront cash purchase price. The delivery of the future receivables purchased in exchange for the advance cash purchase price is facilitated through the seller’s payment processing activities with the Company. There is no economic recourse to the seller in the event that the future receivables are not generated. There is also no fixed period of time in which the seller must deliver the purchased future receivables to the Company, as delivery of the purchased future receivables is contingent on the sellers’ generation of such receivables.

Although there is no economic recourse to the seller in the event that the future receivables are not generated, the degree of uncertainty related to this economic benefit is mitigated by the due diligence performed by the Company prior to purchasing the seller’s future receivables and is further mitigated by contractual remedies.

The Company’s due diligence includes, but is not limited to, detailed analysis of the seller’s historical processing volumes, transaction count, chargeback history, growth of the seller, and account longevity with the Company or marketplace.

The Company recognizes revenues associated with these fees over the CA period, adjusting the amount to reflect an effective interest rate. The fees earned on these receivables are included in revenue on the consolidated statements of comprehensive income and the total fees were not significant to the Company’s operations for the years ended December 31, 2025, 2024 or 2023.

CA receivables, net represents the aggregate amount of CA-related receivables as of the consolidated balance sheet date, net of an allowance for potential uncollectible amounts in the event of merchant fraud, diversion or default. For the purchased receivables, the Company is generally exposed to potential advance losses related to uncollectibility, and as such, the Company establishes an allowance for CA losses (“ALCAL”). Changes to the ALCAL are reflected as transaction costs on the consolidated statements of comprehensive income, according to company’s charge-off methodology.

The ALCAL is primarily based on expectations of credit losses based on historical lifetime loss data as well as macroeconomic forecasts applied to the portfolio, which is segmented by programs. Loss rates are generated using historical loss data for each portfolio and are applied to segments of each portfolio. The Company then applies macroeconomic factors such as market unemployment rate, current and forecasted GDP, S&P yield and inflation rate, which are sourced externally, using a single scenario that the Company believes is most appropriate to the economic conditions applicable to a particular period. Expected credit loss rates, inclusive of historical loss data and macroeconomic factors, are applied to the principal amount of the Company’s CA receivables.

**j.**Property, equipment and software, net:

Property, equipment, and software are stated at cost less accumulated depreciation and amortization. Additions, renewals, and betterments are capitalized. Maintenance and repairs that do not extend the useful life of the asset are expensed as incurred.

The Company computes depreciation and amortization using the straight-line method over the estimated useful lives as follows:

The Company accounts for costs incurred to develop or obtain software and other applications for internal use in accordance with ASC 350-40,Internal-Use Software. Software purchased for internal use is accounted for as the acquisition of an intangible asset and is capitalized at cost. Costs related to developing software for internal use are expensed or capitalized depending on the project stage in which the costs are incurred. The Company capitalizes costs incurred during the application development stage, which include costs to design the software, application configuration, interfaces, coding, installation, and testing. Costs incurred during the preliminary project and post-implementation stages are expensed as incurred.

Capitalized internal use software is presented within intangible assets, net on the consolidated balance sheets. The assets are amortized over the period of estimated benefit of 1.2-3 years, using the straight-line method, and related amortization is presented under depreciation and amortization on the consolidated statements of comprehensive income. No significant residual value is estimated for internal use software. Costs incurred to maintain existing product offerings are expensed as incurred. The capitalization and ongoing assessment of recoverability of development cost requires considerable judgement by management.

The Company enters into certain cloud-based software hosting arrangements. If management determines that a cloud computing arrangement conveys the right to a software license, the Company accounts for the software license element of the arrangement consistent with the acquisition of other internal use software licenses. If a cloud computing arrangement does not include a software license, the Company accounts for the arrangement as a service contract and expenses all costs not directly related to capitalizable implementation, including overhead costs and costs of service agreements, in the period they are incurred.

Costs related to implementation of cloud computing arrangements that qualify for capitalization are stated at cost less accumulated amortization within prepaid expenses, allocated between other current and other non-current assets on the consolidated balance sheets based on the expected amortization to be recognized within one year. Such capitalized costs are amortized using the straight-line method over the fixed, non-cancellable term of the associated hosting arrangement, plus any reasonably certain renewal periods, beginning when the cloud computing arrangement is substantially complete and ready for its intended use. The amortization expense of such capitalized costs are presented within the same financial statement line items as the associated service fees in the consolidated statements of comprehensive income.

As of December 31, 2025, the net carrying value of capitalized implementation costs included $3,125 in other non-current assets.

In evaluating purchase transactions, the Company first applies a screen test to determine if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets.

If the screen test is met, the transaction is accounted for as an asset acquisition. The Company recognizes assets acquired in an asset acquisition based on the cost to the Company on a relative fair value basis, which includes transaction costs in addition to consideration transferred and liabilities incurred as part of the transaction. Neither goodwill nor bargain purchase gains are recognized in an asset acquisition.

If the screen test is not met, the Company further considers whether the set of assets or acquired entities have at a minimum, inputs and processes that have the ability to create outputs which would meet the definition of a business. The Company accounts for business combinations using the acquisition method when control is transferred to the Company. The consideration transferred in the acquisition is measured at fair value, as are the identifiable net tangible and intangible assets acquired. The fair value of the assets are considered significant estimates made by the Company. Any residual purchase price is allocated as goodwill. Transaction costs are expensed as incurred, except if related to the issue of debt or equity securities. Any contingent consideration connected to the business combination is measured at fair value at the date of acquisition and each reporting period thereafter. During the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the fair value of these tangible and intangible assets acquired and liabilities assumed in the business combination, with the corresponding offset recorded to goodwill. Upon the conclusion of the measurement period or final determination of the fair value of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the Company’s consolidated statements of comprehensive income or as an adjustment to acquisition-related assets and liabilities.

Goodwill represents the excess of the purchase price over the fair value of net assets acquired in a business combination and is allocated to the reporting unit expected to benefit from the business combination. Goodwill is tested for impairment, at a minimum, on an annual basis at the reporting unit level by first performing a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value. If the reporting unit does not pass the qualitative assessment, the reporting unit’s carrying value is compared to its fair value. Goodwill is considered impaired if the carrying value of the reporting unit exceeds its fair value.

The fair value of the reporting unit is estimated using a discounted cash flow method. The discounted cash flow method, a form of the income approach, uses expected future operating results and a market participant discount rate. Failure to achieve these expected results, changes in the discount rate or market pricing metrics, may cause a future impairment of goodwill at the reporting unit level.

Intangible assets consist of internal use software (refer to note 2k), customer relationships, and acquired developed technology. Intangible assets are amortized over the period of estimated useful life using the straight-line method and have estimated useful lives as shown below. No significant residual value is estimated for intangible assets.

The Company computes amortization using the straight-line method over the estimated useful lives as follows:

The Company evaluates intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. An asset is considered impaired if its carrying value exceeds the future net cash flow the asset is undiscounted.

Indefinite-lived intangible asset consists of a payment business license recognized in the PayEco acquisition. The indefinite-lived intangible asset is not amortized, but is tested for impairment annually, or more frequently if events or circumstances indicate that the asset might be impaired. The impairment assessment begins with a qualitative evaluation to determine whether it is more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount. If this threshold is met, the Company performs a quantitative assessment, comparing the fair value of the asset to its carrying amount. The indefinite-lived intangible asset is considered impaired if the carrying value exceeds the fair value.

The fair value of the asset is estimated using a discounted cash flow method. The discounted cash flow method, a form of the income approach, uses expected future operating results and a market participant discount rate. Failure to achieve these expected results, changes in the discount rate or market pricing metrics, may cause a future impairment of the indefinite-lived intangible asset.

o. Impairment of long-lived assets:

The Company reviews long-lived assets for their impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. If the carrying value of the asset exceeded the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset, a write-down would be recorded to reduce the related asset to its estimated fair value.

The Company determines whether an arrangement is a lease for accounting purposes at contract inception by determining whether an asset is explicitly or implicitly identified in the arrangement, and whether the Company obtains the right to control the use of that asset. As of December 31, 2025 and 2024, the Company had entered into operating leases for office facilities, data centers and employee vehicles and did not have any finance leases.

Operating leases are recorded as right-of-use (“ROU”) assets, which are presented as right-of-use assets, and lease liabilities, which are included in other payables and other long-term liabilities, on the consolidated balance sheets, depending on their classification as short- or long-term, respectively.

ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The Company’s leases do not provide an implicit rate; it uses an incremental borrowing rate for specific terms on a collateralized basis based on the information available on either the ASC 842,Leases, transition date or lease commencement date, as applicable, in determining the present value of lease payments.

The ROU asset calculation accounts for lease payments and incentives. The ROU asset and lease liability may include amounts attributed to options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating leases is recognized on a straight-line basis over the lease term. In certain instances, the Company may have lease agreements with lease and non-lease components. In these instances, the Company has elected to apply the practical expedient and account for the lease and non-lease components as a single lease component for all leases. The Company applies a single portfolio approach within certain lease classes to account for the ROU assets and lease liabilities. The Company does not recognize ROU assets and lease liabilities arising from short-term leases.

The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in ASC 480,Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815,Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own shares of Common Stock and whether the warrant holders could potentially require different settlement value of consideration in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance.

For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded as a derivative liability at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as gain or loss on the consolidated statements of comprehensive income. In accordance with ASC 825-10,Financial Instruments, offering costs attributable to the issuance of the derivative warrant liabilities are recognized in the statements of comprehensive income as incurred.

The Company accounts for repurchases of shares of its common stock as of the trade date, and includes in treasury stock the repurchase price plus any costs associated with the transaction.

When and if treasury stock is reissued, the Company applies the average cost method to determine the value of the reissued shares. The Company credits gains on reissuances to additional paid-in capital and offsets losses against historical gains. Losses in excess of historical gains will be recognized against retained earnings.

Treasury stock is included in authorized and issued shares but excluded from outstanding shares.

Revenue is recognized when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services.

The majority of the Company’s revenue is recognized and collected upon the completion of the underlying transaction.

Card and customer account revenue:

Capital advance fees:

The Company offers customers a capital advance in exchange for a fixed amount of their future receivables. Such customers use Payoneer’s payment services to receive payments from third-party online marketplaces for goods and services sold on the marketplaces. For the capital advances in which the Company retains the right to future receivables, the fee is recognized over the advance period. Refer to Note 2i for the Company’s accounting policy related to capital advance receivables.

Global bank transfer revenue:

Revenues generated from bank transfers are recorded at the time the related funds transfer is executed and delivered to the beneficiary. Revenue is deferred until it reaches the beneficiary even if it has been collected by the Company at any point during the bank transfer process. The timing of recognition is dependent on geographic region, and overall reliance on third-party processors and financial institutions.

The Company uses third-party processors and financial institutions in executing foreign exchange transactions with third-parties. The Company acts as the principal in these transactions and recognizes revenue as it relates to these transactions on a gross basis as the Company controls the service to the end customer and directs third-party processors and other financial institutions to perform the specified services on the Company’s behalf. To the extent revenues are recorded on a gross basis, any commissions or other payments to third-parties are recorded as transaction costs so that the net amount (gross revenue less transaction costs) is reflected in operating income. The company charges both fixed and variable fees related to global bank transfers. Fixed fees are generally on a per transaction basis while variable are generally based on volume of transactions where transactions involve funds transferred to the Company in one currency which are transferred to a beneficiary in another currency.

Interest earned on customer funds balances:

As discussed in Note 2g, the Company holds customer funds in both interest and non-interest bearing accounts. Interest earned on these balances is recognized as revenue.

Customer acquisition costs:

The Company capitalizes certain consideration paid to customers, which include costs associated with customer acquisition rewards, and certain costs to obtain contracts, which include employee sales commissions that are incremental to the acquisition of customer contracts. These costs are recorded as other assets on the consolidated balance sheets. The Company determines whether costs should be deferred based on the incremental nature of the underlying cost and if the cost would not have occurred absent the customer acquisition.

Customer acquisition rewards primarily refers to incentive payments made to existing customers, third parties and new customers when a new customer is referred and utilizes the Company’s services, subject to certain conditions. Certain capitalized sales commissions include payments made to employees that are directly related to new customers’ acquisitions or increased revenue or volume for existing customers.

Amortization of customer acquisition rewards and sales commissions are consistent with the pattern of revenue recognition of each performance obligation. Incentives earned by customers and third parties for referring new customers are paid in exchange for a distinct service and accounted for as sales and marketing expenses on the consolidated statements of comprehensive income. Any amounts paid in excess of the fair value of the referral service received are recorded as a reduction of revenue. Fair value of the service is established using amounts paid to vendors for similar services. The Company has applied the practical expedient in ASC 340-40 to expense costs as incurred for costs to obtain a contract with a customer when the amortization period would have been one year or less.

The Company recognizes an asset for incremental costs to obtain a contract such as sales commissions and other customer incentives. The asset is amortized on a systematic basis over the expected customer relationship period, which is estimated as of December 31, 2025 to be 2.43 years. The amortization is recorded within sales and marketing expense on the consolidated statements of comprehensive income.

The Company offers various programs to acquire customers. In certain customer acquisition arrangements with existing customers, the payments to the customer are recorded as a reduction of revenue.

The Company periodically reviews these deferred customer acquisition costs to determine whether events or changes in circumstances have occurred that could impact the period of benefit. There wereno impairment losses recorded during the periods presented.

Transaction costs consist of fees paid to banks, processors and card networks, costs to acquire currencies, card supply costs and other fees related to the Company’s services. These costs are net of any rebate programs with banks, processors and networks, such as currency conversion assessment rebates and volume rebates. These costs are primarily driven by the number of transactions and volume.

The Company is exposed to potential transaction losses due to credit or debit collections, recalled payments and card negative balances and related chargebacks, including charge-offs related to CA. These losses are included in transaction costs. The Company established an allowance for estimated losses arising from processing customer transactions, which represents an accumulation of the estimated amounts necessary to provide for transaction losses incurred as of the reporting date, including those for which the Company has not yet identified. The allowance is monitored quarterly and is updated based on actual claims data. The allowance is based on known facts and circumstances as well as internal factors. As of December 31, 2025 and 2024, the provision for transaction losses, including the allowance for CA totaled $6,678 and $8,004, respectively, and was included in other payables, with the exception of the allowance for CA which is within CA receivables, net on the consolidated balance sheets. Transaction costs also included expenses related to the Warehouse Facility in 2024.

Other operating expenses mainly include compensation for our employees and subcontractors, who support customer onboarding and support needs, payment operations, compliance and risk monitoring activities as well as third party vendor costs incurred related to fraud detection capabilities, compliance operations, regulatory services, as well as maintenance costs related to our customer engagement center infrastructure.

Sales and marketing expenses include business development and product launch costs, marketing and advertising costs, retention and customer support costs, partnership commissions, and certain customer acquisition costs. This also includes employee compensation and related costs to support the sales and marketing process. Advertising and marketing costs are expensed as incurred and amounted to $45,946, $35,767 and $23,878 for the years ended December 31, 2025, 2024 and 2023, respectively.

Research and development expenses are charged to the consolidated statements of comprehensive income as incurred and consist primarily of employee compensation and related costs, professional services and consulting expenses, and non-capitalized costs associated with the development of new technologies and maintenance of existing infrastructure.

General and administrative expenses consist primarily of compensation, benefits and overhead expenses associated with corporate management. This also includes, among other things, directors’ and officers’ liability insurance, director fees, internal and external accounting and legal and administrative resources, including audit and legal fees.

Equity awards granted to employees and non-employees are accounted for using the grant date fair value method. The grant date fair value is determined as follows: for stock options with an exercise price, using the Black Scholes pricing model, for restricted stock units (“RSUs”) with market conditions and the Employee Stock Purchase Plan (“ESPP”), using a Monte Carlo model, for RSUs and stock options with no or an insignificant exercise price with service conditions, using on the grant date share price and for performance stock units (“PSUs”) with service and performance conditions, using the grant date fair value method, based on grant date share price. The fair value of stock-based payment transactions is recognized as expense over the requisite service period. Forfeitures are accounted for as they occur.

The Company measures the compensation cost related to options, RSUs, and ESPP rights awarded on the grant date and recognizes the cost on a straight-line basis over the requisite service period of the awards. Cost of awards with service conditions and market-based conditions for vesting and PSUs are recognized using the graded vesting method. For awards with market conditions, compensation expense is not reversed if the market conditions are not satisfied.

The Company measures the additional compensation cost of modified awards on the date of modification and recognizes the cost (1) on the modification date for past service periods and (2) on a straight-line basis over the future related service period.

The fair value of an equity instrument issued to a non-employee is measured as of the grant date. The fair value of the awards is recognized over the vesting period, which coincides with the period that the counter-party provides services to the Company.

The Company recognizes a tax benefit of stock-based compensation in the consolidated statements of comprehensive income if the tax benefit is realized.

The Company issues new shares of common stock for the ESPP at the end of the ESPP period, upon exercise of options and RSU vesting.

Credit risk concentration

Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash and cash equivalents, customer funds, restricted cash, accounts receivable, term deposits, available-for-sale debt securities and interest rate derivatives. The Company’s assets are held with various institutions, which may include banks, payment service providers, or other financial institutions throughout the world. The Company regularly reviews its relative exposure to financial and other institutions and has relationships with a globally diversified group of service providers. A significant portion of the Company’s funds are deposited at large depository institutions and global systematically important banks. The vast majority of those cash funds exceed applicable FDIC coverage insurance limits or are held with financial institutions in countries that do not offer deposit insurance and are subject to specific institutional, regional and country risks. The Company is also exposed to transaction losses due to funds blocked with its global bank transfers processors. See also Note 18.

56% and 58% of the Company’s cash and cash equivalents and customer funds are concentrated with U.S. financial institutions as of December 31, 2025 and 2024, respectively.

Cash and cash equivalents and customer funds balances denominated in U.S. dollars represents 74% of the balance of the cash, cash equivalents and customer funds at both December 31, 2025 and 2024.

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (continued):

Vendor concentration

The Company issues cards directly under its Mastercard license and utilizes a third-party issuing bank for issuance to customers in the United States and for its corporate purchasing card service. If the issuing bank ceases to transact with current cardholders, experiences a significant disruption that affects current cardholder transactions, or ceases to operate as an issuing bank due to circumstances outside of the Company’s control, or if Mastercard revokes the Company’s license to issue cards, the Company’s financial condition and operating results could be materially impacted.

Marketplace and customer concentration

In 2025, 2024, and 2023, revenues associated withone individual marketplace represented 21%,23%, and 25%, respectively, of total revenue. In 2023 revenues associated with another individual marketplace represented 11% of total revenue.

In 2025, 2024 and 2023, revenues generated from customers who reside in Greater China constituted 34%,35% and 35%, respectively, of total revenues. This geographic concentration creates exposure to local economic and political conditions, and to economic downturns in the markets serviced by customers who reside in Greater China, as well as to macroeconomic factors, such as changes in trade policy and other governmental actions, including tariff policy, that affect the region. Any unforeseen events or changes in regulation or legal requirements in Greater China that restrict the services the Company can provide to customers who reside in Greater China could have a material impact on the Company’s financial statements.

Geographical employee concentration

In October 2025, a ceasefire between Israel and Hamas entered into effect, to end a two-year long war between them that started on October 7, 2023. During the war conflicts between Israel and Hezbollah, Iran and other proxies of the Iranian regime were also involved. During the war, we continued to operate our business and serve our customers around the world and, to date, our ability to support customers has not been materially impacted. We continue to monitor the situation closely and benefit from our broad geographic footprint, partially outsourced operations model, and a robust business continuity plan. Additionally, our technology infrastructure has redundancy in place outside of Israel. Approximately 51% of the Company’s global employee base is located in Israel, including approximately 79% of its research and development resources, as of December 31, 2025. An insignificant amount of the Company’s Israeli workforce were called to military reserve duty and the Company has contingencies in place to cover impacted roles and responsibilities.

Income taxes are accounted for using an asset and liability approach as required under U.S. GAAP. The asset and liability approach requires the recognition of taxes payable or refundable for the current year and deferred tax liabilities and assets for the future tax consequences of events that have been recognized in the Company’s financial statements or tax returns. The measurement of current and deferred tax liabilities and assets is based on provisions of the relevant tax law; the effects of future changes in tax laws or rates are not anticipated. Deferred taxes have not been provided on the amount of unremitted earnings from foreign subsidiaries retained for reinvestment in the Company. The measurement of deferred tax assets is reduced, if necessary, by the amount of any tax benefits that, based on available evidence, are not expected to be realized. Valuation allowances are established for deferred tax assets when the likelihood of the deferred tax assets not being realized exceeds the more likely than not criterion. Deferred tax assets and liabilities, along with any related valuation allowance, are classified as non-current assets or non-current liabilities on the balance sheets.

The Company follows the guidance on accounting for uncertainty in income taxes in accordance with U.S. GAAP. The guidance provides a comprehensive model for the recognition, measurement and disclosure in financial statements of uncertain income tax positions that a company has taken or expects to take on a tax return. Under this guidance, a company can recognize the benefit of an income tax position only if it is more likely than not (greater than 50%) that the tax position will be sustained upon tax examination, based solely on the technical merits of the tax position; otherwise, no benefit can be recognized. The tax benefits recognized are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. Additionally, the Company accrues interest and related penalties, if applicable, on all tax exposures for which reserves have been established consistent with jurisdictional tax laws. Interest and penalties are classified as taxes on income in the consolidated financial statements.

Income tax expense includes U.S. (federal and state) and foreign income taxes. Notwithstanding the U.S. taxation of Section 965 Transition Tax amounts in 2017 and ongoing anti-deferral taxation by the U.S. through provisions such as Subpart F income and Global Intangible Low Taxed Income (“GILTI”), the Company intends to continue to invest most or all of its earnings, as well as its capital, in its foreign subsidiaries indefinitely and does not expect to incur any significant, additional taxes related to such amounts.

The Company releases the tax effects from AOCI into earnings in the consolidated statements of comprehensive income when the underlying item of AOCI is realized.

Loss contingencies are recognized in the consolidated financial statements when the loss is probable and can be reasonably estimated. The Company does not recognize matters where a potential loss is only reasonably possible, the range of a reasonably possible loss cannot be estimated or such estimate is immaterial. Gain contingencies are recognized when realized. Legal costs are expensed as incurred and recorded in general and administrative expenses on the consolidated statements of comprehensive income.

Financial Accounting Standards Board (“FASB”) standards adopted during 2025

In 2023, the FASB issued guidance, ASU 2023-09, which modifies the rules on income tax disclosures to require entities to disclose (1) specific categories in the rate reconciliation, (2) the income or loss from continuing operations before income tax expense or benefit (separated between domestic and foreign) and (3) income tax expense or benefit from continuing operations (separated by federal, state and foreign). It also requires entities to disclose their income tax payments (net of refunds received) to international, federal, state and local jurisdictions among other changes. The new standard is effective for annual periods beginning January 1, 2025. The Company adopted the standard prospectively during the year ended December 31, 2025. Refer to Note 23 for required disclosures.

FASB Standards issued, but not adopted as of December 31, 2025

In 2024, the FASB issued guidance, ASU 2024-03, which requires the disaggregated disclosure of certain costs and expenses on an interim and annual basis. The new standard is effective for annual periods beginning January 1, 2027 and interim periods beginning January 1, 2028 and can be applied prospectively with the option for retrospective application to all prior periods presented in the financial statements, with early adoption permitted. The Company is currently evaluating the potential impact of adopting this new guidance on its financial statement related disclosures.

In 2025, the FASB issued ASU 2025-06 Accounting for Disclosure of Software Costs. The new standard modernizes the guidance to reflect the software development approaches currently being used by removing all references to “development stages” from ASC 350-40 Intangibles—Goodwill and Other - Internal-Use Software. Under ASU 2025-06, only the following criteria in ASC 350-40-25-12(b) and (c) must be met for entities to begin capitalizing software costs: (i) management, with the relevant authority, implicitly or explicitly authorizes and commits to funding a computer software project and (ii) it is probable that the project will be completed and the software will be used to perform the function intended (referred to as the "probable-to-complete recognition threshold"). This standard is effective for all entities for annual reporting periods beginning January 1, 2028, and interim reporting periods within those annual reporting periods, with early adoption permitted. The Company is currently evaluating the impact of adopting this new guidance on its financial statements and related disclosures.

NOTE 3 –ACQUISITIONS

PayEco

On April 9, 2025, the Company acquired 100% of the equity interests of PayEco, the parent company of EasyLink Payment Co., Ltd (now Payoneer Payments (Guangdong) Co., Ltd)., a licensed China based payment service provider, for a total consideration of$76,074. The consideration is comprised of the following:

Refer to Note 10 for details on the license intangible asset acquired.

The Company determined that this transaction is an asset acquisition under ASC 805, as the acquired group of assets does not have a substantive process that together with the assets acquired significantly contribute to the ability to create outputs. Therefore, the business definition was not met.

NOTE 3 –ACQUISITIONS (continued):

Skuad

On August 5, 2024, Payoneer acquired 100% of the outstanding equity of Skuad and its subsidiaries, a global workforce and payroll management company. The acquisition accelerates Payoneer’s strategy to deliver a comprehensive and integrated financial stack for SMBs that operate globally. The transaction was accounted for in accordance with ASC 805,Business Combinations(“ASC 805”), using the acquisition method of accounting with Payoneer as the acquirer.

The following table summarizes the fair value of the consideration transferred:

Cash transferred was funded with cash on hand. The contingent consideration was in the form of a $9,709 earn-out subject to meeting certain performance criteria such as revenue and volume for eighteen months post-close, and achievement of certain business goals within twelve months post-close. The fair value of the contingent consideration recognized on the acquisition date of $5,283 was estimated using estimates of probability of each outcome and the Option Pricing Model (“OPM”), except for with respect to the integration plan target, which is not exposed to systemic risk. Note that as shown above, the Company has adjusted the acquisition date fair value of the contingent consideration via a measurement period adjustment of $1,691, recognized as an increase to acquisition date goodwill. This adjustment is a result of refinement of Management’s assumptions around Skuad’s business forecast, based on data that was available at the time of the acquisition. Refer to Note 7 below for details on changes in the fair value of the contingent consideration since acquisition.

The consideration transferred included settlement of a receivable on Payoneer's books, related to commercial payments activities that occurred prior to the closing of the business combination with Skuad, which is now an intercompany relationship eliminated in consolidation. No gain or loss was recognized on settlement.

The settlement of unvested acquiree stock-based compensation awards relates to unvested Skuad stock options which were cancelled upon acquisition and either replaced with Payoneer RSUs or not replaced and settled in cash. Replacement awards included 90,000 RSUs which were measured at fair value based on the grant date share price. Additionally, the Company granted 1,870,577 RSUs valued at $10,364, which are subject to ratable quarterly vesting contingent on future services and continued employment of the Skuad founder and shall be expensed over a remaining service period of up tothree years.

NOTE 3 –ACQUISITIONS (continued):

The following table summarizes the recognized amounts of identifiable assets acquired and liabilities assumed:

The excess of the purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill and is primarily attributable to the significant synergies expected to arise from the acquisition, including enhancement of Payoneer’s comprehensive and integrated financial stack. The Company does not expect goodwill to be deductible for income tax purposes.

At the acquisition date, Payoneer recognized an indemnification asset in the amount of $1,240 related to uncertain tax positions of the acquiree. As noted in the table above, during the three months ended December 31, 2024, the Company recognized an additional $1,764 in indemnification assets related to uncertain tax positions of the acquiree which existed at the acquisition date but had not yet been identified by the Company. There was no impact to earnings related to this adjustment. Payoneer is fully indemnified by the sellers for the full amount of the positions in the event that the related losses are realized.

Due to Skuad’s insignificant size relative to the Company, Payoneer is not providing supplemental pro forma financial information for the current and prior reporting periods. During the year ended December 31, 2024, Payoneer incurred acquisition-related costs of $4,900, which were included in general and administrative expenses on the consolidated statements of comprehensive income.

NOTE 4 – CAPITAL ADVANCE (“CA”) RECEIVABLES

During the years ended December 31, 2025 and 2024, the Company has purchased and collected the following principal amounts associated with CA receivables, including foreign exchange adjustments:

The following are current and overdue balances from above that are segregated into the timing of expected collections at December 31, 2025:

The following are current and overdue balances from above that are segregated into the timing of expected collections at December 31, 2024:

As of December 31, 2025, the Company has applied a range of loss rates to the portfolio of 0.64% to 2.12% for the allowance for CA losses with the weighted average loss rate applied being 1.27%. The Company applied a range of loss rates to the portfolio of 0.87% to 2.02% for the allowance for CA losses with the weighted average loss rate applied being 1.5% as of December 31, 2024.

NOTE 5**- CUSTOMER FUNDS AND INVESTMENTS**

The Company has invested certain customer funds in available-for-sale debt securities and term deposits. The following table summarizes the assets underlying customer funds as of December 31, 2025 and 2024:

As of December 31, 2025, the estimated fair value of the available-for-sale debt securities included $8,801 in unrealized gains and $103 in unrealized losses, net of tax. The gross unrealized losses of $131 related to assets with a fair value of $72,362, which had been in a continuous unrealized loss position for less than 12 months.

Unrealized losses have not been recognized into income as the Company neither intends to sell, nor anticipates that it is more likely than not that it will be required to sell, the securities before recovery of their amortized cost basis. The decline in fair value is due to changes in market interest rates, rather than credit losses. The Company will continue to monitor the performance of the investment portfolio and assess whether impairment due to expected credit losses has occurred.

During the year ended December 31, 2025, the Company did not sell any available-for-sale debt securities or incur any realized gains or losses.

As of December 31, 2025, $350,055 of the Company’s available-for-sale debt securities were due to mature within one year or less, and $956,568 were due to mature between one and five years.

NOTE 6**- DERIVATIVES AND HEDGING**

The following table summarizes the gross notional amount and fair value of outstanding derivative instruments at December 31, 2025 and 2024.

1 The Company’s investment in interest rate derivative instruments consists of investments in 3% interest rate floors to hedge interest income on customer funds in floating rate cash equivalent investments. As of December 31, 2025, the Company held a notional amount of$2,200,000 with varying maturities ranging from 2027 through 2030. The short-term portion of the investments’ fair value shown in the table above relates to the portion of the hedge expiring within one year of the balance sheet date.

2 The Company’s investment in interest rate derivative instruments consists of investments in 3% interest rate floors to hedge interest income on customer funds in floating rate cash equivalent investments. As of December 31, 2024, the Company held a notional amount of$1,900,000 with varying maturities ranging from 2027 through 2029. The short-term portion of the investments’ fair value shown in the table above relates to the portion of the hedge expiring within one year of the balance sheet date.

During the year ended December 31, 2025 and 2024, the Company recognized $2,075 and $12,045 in unrealized losses, net of tax, on derivative instruments designated as cash flow hedges in OCI, respectively.

During the years ended December 31, 2025 and 2024, the Company recognized reductions to revenue of $3,420 and $1, respectively, related to its interest rate floors. During the years ended December 31, 2025 and 2024, the Company also recognized reductions to operating expenses of $9,553 and $132, respectively related to its foreign currency derivatives.

As of December 31, 2025, the Company estimated that $7,784 of unrealized losses related to interest rate floor cash flow hedges currently included in AOCI are expected to be reclassified into net income within the next 12 months. As of December 31, 2025, the Company estimated that $2,852 of unrealized gains related to foreign currency cash flow hedges currently included in AOCI are expected to be reclassified into operating expenses within the next 12 months. As of December 31, 2025, the maximum length of time over which the Company is hedging its exposure to the variability in future cash flows for forecasted transactions is 58 months. During the years ended December 31, 2025 and 2024, the Company did not discontinue any cash flow hedges because it was probable that the original forecasted transaction would not occur and as such, did not reclassify any gains or losses to earnings prior to the occurrence of the hedged transaction.

NOTE 6**- DERIVATIVES AND HEDGING (continued):**

As of December 31, 2025 and 2024, the Company recognized an obligation to return cash collateral related to interest rate floors of $27,260 and $18,790, respectively, which was offset against the gross derivative balances shown in the table above.

NOTE 7**- FAIR VALUE**

The following tables summarize the Company’s financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2025 and 2024:

1 As of December 31, 2025 and 2024, the Company recognized an obligation to return cash collateral related to interest rate floors of $27,260 and $18,790, respectively, which was offset against the gross derivative balances shown in the table above.

NOTE 7**- FAIR VALUE (continued):**

The Company’s foreign currency derivative instruments are valued using pricing models that take into account the contract terms and relevant currency rates. The Company’s interest rate floors are valued using pricing models that take into account the contract terms and relevant interest rates.

As of December 31, 2025 and 2024, the fair values of the Company's cash, cash equivalents, customer funds (other than the portion consisting of available-for-sale debt securities), restricted cash, accounts receivable, capital advance receivables, accounts payable, and outstanding operating balances approximated the carrying values of these instruments presented in the Company's consolidated balance sheets because of their nature.

In 2024, the Company recognized a liability for contingent consideration related to the Skuad acquisition. During the years ended December 31, 2025 and 2024, the Company recognized $680 and $1,770 in loss related to the change in the fair value of the liability since the acquisition date, included within General and administrative expenses on the consolidated statements of comprehensive income. Refer to Note 3 above for additional details around valuation.

In April 2025, the Company recognized liabilities for deferred payments related to the PayEco acquisition, $559 expense related to the imputed interest associated with the liability, included within the Other financial income (expense), net on the condensed consolidated statements of comprehensive income was recognized during the year ended December 31, 2025.

NOTE 8 - OTHER CURRENT ASSETS

Composition of other current assets, grouped by major classifications, is as follows:

NOTE 9 – PROPERTY, EQUIPMENT AND SOFTWARE

Composition of property, equipment and software, grouped by major classifications, is as follows:

Depreciation expense for the years ended December 31, 2025, 2024 and 2023 were $10,034, $8,431 and $8,056, respectively.

During the years ended December 31, 2025, 2024 and 2023, the Company disposed of certain long-lived assets which were fully depreciated and had a cost of $11,207, $5,655 and $2,915.

NOTE 9 – PROPERTY, EQUIPMENT AND SOFTWARE (continued):

The following table presents the Company’s property, equipment and software, net of depreciation, by geographic region:

NOTE 10 – GOODWILL AND INTANGIBLE ASSETS

Goodwill

The Company conducted the annual impairment test of goodwill as of September 30, 2025. The Company elected to perform a qualitative analysis of fair value of the reporting unit compared to the carrying value of the reporting unit. Based on the results of this analysis, the Company determined that goodwill was not impaired. The Company has not recognized an impairment charge in any of the years ended December 31, 2025, 2024 and 2023. No triggering events have occurred since the annual impairment assessment that would change the Company’s assessment.

There wereno changes to the Company’s goodwill balance of $77,785 during the year ended December 31, 2025.

Refer to Note 3 for details around goodwill acquired during the year ended December 31, 2024. The following table presents goodwill balance and adjustments related to those balances during the year ended December 31, 2024.

Intangible assets

Composition of intangible assets, grouped by major classifications, is as follows:

NOTE 10 – GOODWILL AND INTANGIBLE ASSETS (continued):

As discussed in Note 3, in April 2025, the Company completed its acquisition of PayEco. The Company determined that this transaction is an asset acquisition under ASC 805, as the acquired group of assets does not have a substantive process that together with the assets acquired significantly contribute to the ability to create outputs. Therefore, the business definition was not met. The Company has determined that the license is an indefinite lived intangible asset with a carrying value of $97,357 at December 31, 2025.

The Company conducted the annual impairment test of the payment license as of September 30, 2025. The Company elected to perform a qualitative analysis of fair value of the payment license to its carrying amount. Based on the results of this analysis, the Company determined that the license was not impaired. No triggering events have occurred since the annual impairment assessment that would change the Company’s assessment.

Amortization expense for the years ended December 31, 2025, 2024 and 2023 was $53,692, $37,015 and $19,434, respectively.

At December 31, 2025, 2024 and 2023, the Company evaluated internal use software for impairment and determined to impair internal use software assets no longer in use.

During the years ended December 31, 2025 and 2024, the Company recognized $1,899 and $1,850, respectively, animpairment related to abandoned internal use software assets which were fully impaired. During the year ended December 31, 2023, the Company recognized $293 in impairment of intangibles acquired through the acquisition of the remaining interest in a joint venture as described in Note 11. The acquired intangibles were determined to have no use to the Company post-acquisition. The Company also recognized an insignificant amount of additional impairment related to other intangible assets. The impairments are presented under Depreciation and amortization expenses.

Expected future intangible asset amortization as of December 31, 2025, excluding capitalized internal use software of $21,412 not yet placed in service as of that date, was as follows:

NOTE 11 – INVESTMENT IN ASSOCIATED COMPANY

In July 2019, the Company, through its wholly-owned subsidiary Payoneer Research and Development Ltd., entered into an agreement for the establishment of a joint venture company in the People’s Republic of China (“PRC”). The objective of the joint venture was to apply for a local payment service provider license in accordance with PRC laws. The Company’s share in the Joint Venture was 46%, and the remaining ownership interest was held by two local partners. Initial funds in the amount of $6,501 were contributed. The investment in the joint venture was presented as an investment in associated company in the Company’s consolidated balance sheets as the Company did not have control over the joint venture.

In January 2023, the Company, through Payoneer Research and Development Ltd., acquired all remaining interests from other partners in the joint venture for cash consideration of $7,961. As part of the agreement, the acquiring company assumed responsibility for all expenses and income incurred or earned through the date of acquisition related to the joint venture. The entity was liquidated in February 2025.

As substantially all of the fair value of the gross assets of the joint venture were concentrated in a group of similar assets (cash and cash equivalents and restricted deposits in the amount of $13,914), the Company accounted for the transaction as an asset acquisition. As such, the Company’s basis in the acquired assets is valued at the amount of consideration transferred.

NOTE 12 – LEASES

The Company’s lease expense was as follows:

The operating cash flows associated with operating leases were $10,995, $14,068 and $10,248 for the years ended December 31, 2025, 2024 and 2023, respectively. Additional balance sheet information related to leases was as follows:

During the year ended December 31, 2025, the Company commenced a new operating lease for several floors of a building in Israel for a total right-of-use asset of $32,678, which is included within our Operating lease right-of-use assets on the consolidated balance sheets. This lease expires over various periods between 2031 and 2036. In connection with this lease, the Company has provided a cash security deposit of $3,630. This amount is recorded in Restricted cash – long-term on the consolidated balance sheets.

Operating lease amounts include minimum lease payments under the Company’s non-cancelable operating leases primarily for office facilities and employee vehicles. The amounts presented are consistent with contractual terms and are not expected to differ significantly from actual results under the Company’s existing leases.

The Company leases its facilities under various operating lease agreements, which expire on various dates. The minimum lease commitments due as of the year ended under non-cancelable operating leases are as follows:

NOTE 13 - OTHER PAYABLES

Composition of other payables, grouped by major classifications, is as follows:

NOTE 14 – OTHER LONG-TERM LIABILITIES

Composition of other long-term liabilities, grouped by major classifications, is as follows:

NOTE 15 – RESTRUCTURING CHARGES

During the first quarter of 2025, the Company incurred and paid $2,630 of severance and other employee termination benefits mostly related to a strategic shift in how the Company provides Checkout capabilities to its customers and efficiencies realized in the Company’s Checkout product. During the fourth quarter of 2025, the Company incurred $2,243 of severance and other employee termination benefits related to broad expense efficiency measures. The expense efficiency measured continued through the first quarter of 2026. As of December 31, 2025, $1,925 has been paid related to severance and other employee termination benefits.

The Company did not incur restructuring charges during the year ended December 31, 2024.

During the third quarter of 2023, the Company initiated a plan to reduce its workforce by approximately 9% (the “Plan”). The Plan was intended to enhance productivity and efficiency and streamline the Company’s organizational structure to better align operations with its growth objectives.

During the year ended December 31, 2023, the Company incurred and paid costs of $4,488 related to severance and other employee termination benefits.

NOTE 15 – RESTRUCTURING CHARGES (continued):

The restructuring costs are recognized in the consolidated statements of comprehensive income as follows:

NOTE 16 – SEVERANCE PAY FUND AND ACCRUED SEVERANCE PAY

While the Company maintains immaterial severance pay liabilities in several jurisdictions globally, the following discussion covers the severance arrangement in Payoneer Research and Development Ltd. (“The Israeli Subsidiary”), which is its most material arrangement and makes up substantially all of the severance pay liabilities included within Other long-term liabilities on the consolidated balance sheets.

Labor laws in Israel and employment agreements require paying severance pay to employees that are dismissed or retire from their employment in certain circumstances, according to a defined benefit plan. Employees (for whom the Company makes regular deposits in pension and severance pay funds according to a defined benefit plan) dismissed before attaining retirement age are entitled to severance pay computed on the basis of their latest pay rate. In respect of these employees, the Company is committed to supplement the difference between severance pay computed as above and the amounts accumulated in the abovementioned funds. Commencing in 2011, the Israeli Subsidiary added Section 14 of the Severance Pay Law - 1963 to new employees’ agreements that eliminates the need to accrue provisions for retirement expenses for these employees, other than periodic payments made on behalf of the employees that are expensed periodically. The accrued severance pay liability was $1,309 and $1,190 as of December 31, 2025 and 2024, respectively.

The Israeli Subsidiary’s severance pay liability for the Israeli employees is covered mainly by the purchase of insurance policies. The value of these policies is recorded as an asset in the consolidated balance sheets. The balance of the severance pay fund was $856 and $757 as of December 31, 2025 and 2024, respectively.

NOTE 17 – WARRANTS AND SHAREHOLDER’S EQUITY

Share Repurchase Program and Treasury Stock

On May 7, 2023, the Company’s Board of Directors authorized a stock repurchase program that provides for the repurchase of up to $80,000 of its common stock, including any applicable excise tax. On December 7, 2023, the Board authorized an amendment to the program to increase the authorized amount of repurchases to an aggregate amount not to exceed $250,000, including the amount that remained available as of December 7, 2023 to repurchase common stock under, but not any prior repurchases effected pursuant to, the previous authorization, and any applicable excise tax. On July 30, 2025, our Board of Directors amended the existing repurchase authorization to increase the authorized amount of repurchases to an aggregate amount not to exceed $300,000, which amount includes amounts that remained available to repurchase common stock under, but not any prior repurchases effected pursuant to, the existing repurchase program and any applicable excise tax. The effective date of the amended authorization was August 6, 2025, and the amended authorization expires on December 31, 2027.

The program is intended to offset the impact of dilution from the issuance of new shares as part of employee compensation programs.

Any share repurchases under this stock repurchase program may be made through open market transactions, privately negotiated transactions or other means including in accordance with Rule 10b-18 and/or Rule 10b5-1 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The timing and total amount of repurchases is subject to business and market conditions and the Company’s discretion.

During the year ended December 31, 2025, the Company repurchased 27,249,432 shares of its common stock for $175,143, including taxes and fees, at a weighted average cost of $6.41 per share, respectively. During the year ended December 31, 2025, the Company incurred excise tax of $568 related to share repurchase activity which was recorded in treasury stock at cost. During the year ended December 31, 2024, the Company repurchased 24,807,647 shares of its common stock for $136,788, including taxes and fees, at a weighted average cost of $5.50 per share, respectively. As of December 31, 2025, a total of approximately $192,061 remained available for future repurchases of the Company’s common stock under the program.

Common Stock

Holders of common stock are entitled toone vote per share and to receive dividends, when declared. The holders have no preemptive or other subscription rights and there are no redemption or sinking fund provisions with respect to such shares.

Public Warrants

On June 25, 2021, Payoneer Inc. (a subsidiary company) and FTAC Olympus Acquisition Corporation (“FTOC”) consummated a previously announced business combination through a merger of subsidiaries under a newly formed holding company (the “Reverse Recapitalization”). The Company had publicly traded warrants that were assumed upon the Reverse Recapitalization, and were exercisable for shares of the Company’s common stock. Warrants were only exercisable for a whole number of shares at an exercise price of $11.50 and would expire on June 25, 2026, or earlier, if redeemed. In September 2024, the Company completed a tender offer (the “Offer”) to repurchase all outstanding Warrants, at $0.78 per Warrant. Concurrently with the Offer, the Company solicited consents (the “Consent Solicitation”) from holders of its outstanding Warrants to amend the agreement governing the Warrants (the “Warrant Agreement”) to permit the Company to redeem all Warrants that remained outstanding after the completion of the Offer for $0.70 per Warrant in cash, without interest.

NOTE 17 – WARRANTS AND SHAREHOLDER’S EQUITY (continued):

The Offer expired on September 9, 2024 (the “Expiration Date”), in accordance with its terms.24,030,937 Warrants were validly tendered and not validly withdrawn from the Offer representing approximately 95.5% of the then-outstanding Warrants. These Warrants were repurchased for $0.78 per Warrant, or $18,744 in total, with a $13,217 loss recognized upon repurchase, which is the result of the premium paid above the valuation of the Warrants as of the latest revaluation date of June 30, 2024. On September 10, 2024, the Company issued a notice of redemption to redeem all remaining untendered and outstanding Warrants for $0.70 per Warrant as of September 25, 2024. These Warrants were redeemed for $0.70 per Warrant, or $789 in total, with a $530 loss recognized upon repurchase, which is the result of the premium paid above the valuation of the Warrants as of the latest revaluation date of June 30, 2024. The Company also incurred approximately $1,000 in expenses associated with the transaction, which are included in loss on warrant repurchase/redemption in the consolidated statements of comprehensive income for the year ended December 31, 2024.

The Warrants were accounted for as liabilities in accordance with ASC 815-40 and were presented within warrant liabilities on the Company’s consolidated balance sheets. The warrant liabilities were measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the consolidated statements of comprehensive income. The following table presents the changes in the fair value of warrant liabilities (Level 1):

Private Warrants

In September 2015, the Company issued equity classified private warrants to a non-employee, in association with a commercial services agreement. The warrants entitled the holder to purchase shares of Common Stock at an exercise price of $1.79 per share, after specified adjustments, and were scheduled to expire 10 years from issuance and to be commensurately automatically exercised if not exercised prior.

At December 31, 2024 and 2023,1,792,994 private warrants were outstanding, out of which 1,080,707 were vested. The Company did not recognize additional expenses related to the warrants in 2025, 2024 or 2023.

Pursuant to the warrant agreement, and in connection with the business combination with FTAC Olympus Acquisition Corp, in 2021, the warrant holder was eligible to receive consideration payable in cash and Common Stock upon exercise. The warrants were automatically exercised in September 2025, resulting in the Company paying $1,332 in cash and issuing 676,934 shares of Common Stock, on a net exercise basis.

NOTE 17 – WARRANTS AND SHAREHOLDER’S EQUITY (continued):

Accumulated Other Comprehensive Income (Loss)

The changes in the balances of each component of accumulated other comprehensive income (loss), net of tax, for the years ended December 31, 2025 and 2024 were as follows.

NOTE 18 – COMMITMENTS AND CONTINGENCIES

The Company’s business is subject to various laws and regulations in the United States and other countries from where the Company operates. Any regulatory action, tax or legal challenge against the Company for noncompliance with any regulatory or legal requirement could result in significant fines, penalties, or other enforcement actions, increased costs of doing business through adverse judgment or settlement, reputational harm, the loss of banking or other operational relationships, the diversion of significant amounts of management time and operational resources, and could require changes in compliance requirements or impose limits on the Company’s ability to expand its product offerings, or otherwise harm or have a material adverse effect on the Company’s business. From time to time, the Company incurs insignificant fines and penalties in the ordinary course of business.

On September 28, 2021, the National Banking and Securities Commission (CNBV) and the Bank of Mexico revoked the banking license of a banking entity utilized by the Company due to the banking entity not meeting applicable capital requirements. As a result, the Company is unable to withdraw funds from the banking entity. The Company has reserved $2,250 for potential losses related to those funds above the recovered amount. The Company applied for and recovered the maximum statutory reimbursement through the deposit insurance provided by Mexican Institute for the Protection of Banking Services (IPAB), totaling $140. The Company has filed a claim in liquidation for the remaining funds; however, the percentage of the deposit that will be recovered in liquidation is not known at this time.

From time to time, the Company is involved in other disputes or regulatory inquiries that arise in the ordinary course of business. These may include suits by its customers alleging, among other things, acting unfairly and/or not in conformity regarding pricing, rules or agreements, improper disclosure of the Company’s prices, rules, or policies or that the Company’s practices, prices, rules, policies, or customer agreements violate applicable law.

NOTE 18 – COMMITMENTS AND CONTINGENCIES (continued):

In addition to these types of disputes and regulatory inquiries, the operations of the Company are also subject to regulatory and/or legal review and/or challenges that tend to reflect the increasing global regulatory focus to which the industry in which the Company operates is subject and, when taken as a whole with other regulatory and legislative action, such actions could result in the imposition of costly new compliance burdens on the Company and may lead to increased costs and decreased transaction volume and revenue.

This includes the risk that tax authorities in various jurisdictions have or may challenge the Company’s compliance with non-income tax obligations which could result in assessments, disputes and additional compliance requirements affecting the Company and our customers.

Any claims or regulatory actions against the Company, whether meritorious or not, could be time consuming, result in costly litigation, settlement payments, damage awards (including statutory damages for certain causes of action in certain jurisdictions), fines, penalties, injunctive relief, or increased costs of doing business through adverse judgment or settlement, require the Company to change its business practices, require significant amounts of management time, result in the diversion of operational resources, or otherwise harm the business.

NOTE 19 – REVENUE

The following table presents revenue recognized from contracts with customers as well as revenue from other sources:

Based on the information provided to and reviewed by the Company’s CODM, the Company believes that the nature, amount, timing, and uncertainty of its revenue and cash flows and how they are affected by economic factors are most appropriately depicted through its primary regional markets. The following table presents the Company’s revenue disaggregated by primary regional market, with revenues being attributed to the country (in the region) in which the billing address of the transacting customer is located, with the exception of global bank transfer revenues, where revenues are disaggregated based on the billing address of the transaction funds source.

NOTE 19 – REVENUE (continued):

Note that in 2024, the Company has updated the definition of its primary regional markets to align with the view used by Management. This update eliminates South Asia, Middle East and North Africa as a separate region and instead includes revenues from South Asia in the Asia-Pacific region and Middle East and North Africa in the Europe, Middle East, and Africa region. The update has been applied to all periods reflected in the table below.

The following table represents a roll forward of deferred customer acquisition costs:

NOTE 20 - TRANSACTION COSTS

Composition of transaction costs, grouped by major classifications, is as follows:

NOTE 21 – SEGMENT INFORMATION

The Company determines operating segments based on how its CODM manages the business, makes operating decisions around the allocation of resources, and evaluates operating performance. The Company’s CODM are its Chief Executive Officer and Chief Financial Officer, who review its operating results on a consolidated basis. The Company operates inone segment and hasone reportable segment.

The Company’s CODM use consolidated net income, as shown on the consolidated statements of comprehensive income (loss), as the measure of segment profitability. The CODM use net income to evaluate the Company’s ongoing operations and for internal planning and forecasting purposes. This analysis is used in making strategic investment decisions. The Company’s measure of segment assets is reported on the consolidated balance sheets as total assets.

NOTE 22 – STOCK-BASED COMPENSATION

Option and restricted stock compensation plans

The Company maintains three stock-based compensation incentive plans: the Payoneer Inc. 2007 Share Incentive Plan and the Payoneer Inc. 2007 U.S. Share Incentive Plan (hereafter together – the “2007 Plan”), the Payoneer Inc. 2017 Stock Incentive Plan (hereafter – the “2017 Plan”) and the 2021 Omnibus Incentive Plan (the “2021 Plan”).

Under each of the plans, no options shall be exercisable after the expiration of 10 years after the effective date of grant.

NOTE 22 – STOCK-BASED COMPENSATION (continued):

Options

As of December 31, 2025,6,985,323 options are outstanding under the Plans. Each option can be exercised to purchaseone share of Common Stock par value USD 0.01 each of the Company. The Company has approved the grant of the following stock options:

The vesting period of the outstanding options is generally 4 years from the date of grant. The following table presents the weighted-average assumptions used to estimate the fair value of the stock options granted by the Company. The years ended December 31, 2025 and 2023 are excluded from this table as there wereno new options granted by the Company in these periods:

The Company selected the Black-Scholes Merton option pricing model as the most appropriate fair value method for its stock options awards based on the market value of the underlying shares at the date of grant. Historical information for a selection of similar publicly traded companies was the basis for the expected volatility. Historical information and management expectations were the basis for the expected dividend yield. The expected lives of the options are based upon the simplified method per ASC 718,*Compensation – Stock Compensation.*The risk-free interest rate was selected based upon yields of U.S. Treasury issues with a term equal to the expected life of the option being valued. Option vesting generally occurs in tranches up tofour years.

As of December 31, 2025, there were approximately $1,856 of unrecognized compensation costs outstanding, related to unamortized stock option compensation which are expected to be recognized over a weighted-average period of 1.56 years. Total unrecognized compensation cost will be recognized as incurred. In addition, as future grants are made, additional compensation costs will be incurred.

NOTE 22 – STOCK-BASED COMPENSATION (continued):

The following table presents a summary of stock option activity for the year ended December 31, 2025:

The aggregate intrinsic value of options exercised was $18,546, $76,287 and $25,246 for the years ended December 31, 2025, 2024 and 2023, respectively. In 2025, 2024 and 2023, the Company has received a tax benefit of $52, $636 and $1,201, respectively, in excess of the tax benefit based on the intrinsic value on date of issuance of the stock-based compensation, respectively.

Restricted and Performance Stock Units

The cost of RSUs granted is determined using the fair market value of the Company’s common stock on the date of grant. PSUs are accounted for using the grant date fair value method, based on the grant date share price.

The following table summarizes the RSUs and PSUs activity under the 2017 Plan and the 2021 Plan and other business arrangements associated with business acquisitions as of December 31, 2025:

In the year ended December 31, 2025, the Company granted a total of 8,175,655 RSUs, under the Company’s Omnibus Stock Incentive Plan, which are subject to time-vesting and continued service conditions. In the same period, the Company granted 895,103 PSUs under the same Plan, which are subject to time-vesting, continued service conditions and achievement of certain Company performance goals.

The total vesting-date value of equity classified RSUs vested during 2025 was $92,393. As of December 31, 2025, the unrecognized compensation cost related to all unvested equity classified RSUs of $123,365 is expected to be recognized as an expense on a straight-line basis over a weighted-average period of 1.81 years.

The Company withholds common stock shares associated with net share settlements to cover tax withholding obligations upon the vesting of restricted stock units under its equity incentive plans in the United States. During the year ended December 31, 2025, the Company withheld 1,999,690 shares for $15,726 During the year ended December 31, 2024, the Company withheld 2,253,817 shares for $16,068. RSU vesting is shown net of this withholding on the consolidated statements of shareholders’ equity and cash flows.

NOTE 22 – STOCK-BASED COMPENSATION (continued):

The Company collects cash from proceeds from certain international employees’ sales of common stock. The amount is held in a Company bank account until it is remitted to the employees. Due to the restrictions on the use of the funds in the bank account, the Company has classified the amount as short-term restricted cash, and a corresponding liability is included in Other payables in the consolidated balance sheets. As of December 31, 2025, $361 of such funds were held.

In 2025, 2024 and 2023, the Company has received a tax benefit of $4,436, $1,539 and $0, respectively, in excess of the tax benefit based on the intrinsic value on date of issuance of the stock-based compensation, respectively.

Employee Stock Purchase Plan

The Company initiated, on May 16, 2022, the first offering period under the ESPP, the purpose of which is to provide employees of the Company and its designated subsidiaries with an opportunity to purchase Company Common Stock at a discount through payroll deductions and to help eligible employees provide for their future security and to encourage them to remain in the employment of the Company.

Each eligible employee enrolling for any offering period under the ESPP is required to designate a whole percentage of their monthly payroll to be withheld by the Company or the designated subsidiary employing such eligible employee on each payday during the applicable offering period. The designated deduction percentage may not be less than 1% and may not be more than 15% of the employee’s salary subject to a maximum of $25 per year, unless otherwise determined by the Company for any specific offering period. Any offering period is comprised of one or more 6 months’ purchase periods, at the last trading day of each (a “Purchase Date”), the Company will use the total amount deducted from each participant, subject to quantity limitations determined by the Company for such offering period, to issue such participant with such number of Company shares based on a purchase price which shall not be less than 85% of the closing sales price for a Company share on the first trading day of the applicable offering period or on the relevant Purchase Date, whichever is lower.

During the year ended December 31, 2025, employees participating in the ESPP purchased 678,351 shares at a per share price of $5.79 when the November 30, 2024 to May 30, 2025 offering period closed, and 610,185 shares at a per share price of $4.91 when the May 31, 2025 to November 29, 2025 offering period closed.

During the year ended December 31, 2024, employees participating in the ESPP purchased 697,263 shares at a per share price of $4.68 when the November 16, 2023 to May 15, 2024 offering period closed, and 574,487 shares at a per share price of $4.98 when the May 16, 2024 to November 15, 2024 offering period closed.

During the year ended December 31, 2023, employees participating in the ESPP plan purchased 1,032,434 shares at a per share price of $3.90 when the November 16, 2022 to May 15, 2023 offering period closed, and 821,184 shares at a per share price of $3.77 when the May 16, 2023 to November 15, 2023 offering period closed.

As of December 31, 2025, approximately 2,209,721 shares were reserved for future issuance under the ESPP, and the current offering period, which opened on November 30, 2025, is expected to close on May 30, 2026. The fair value attributable to the plan was $1,450 and $1,587 for the offering periods beginning on November 30, 2025 and May 31, 2025, respectively and was measured using the Black-Scholes pricing model.

As of December 31, 2024, approximately 3,498,257 shares were reserved for future issuance under the ESPP. The fair value attributable to the plan was $1,585, and $1,134 as of the beginning of the November 30, 2024, and May 16, 2024 offering periods, respectively, and was measured using the Monte Carlo model.

As of December 31, 2023, approximately 4,770,007 shares were reserved for future issuance under the ESPP. The fair value attributable to the plan was $1,212, and $1,688 as of the beginning of the November 16, 2023, and May 16, 2023 offering periods, respectively, and was measured using the Monte Carlo model.

The expense associated with the ESPP recognized during the years ended December 31, 2025, 2024 and 2023 was $2,978, $2,149 and $3,321, respectively.

NOTE 22 – STOCK-BASED COMPENSATION (continued):

Options, RSUs, PSUs, and ESPP

The Company records stock-based compensation expense for its equity incentive plans and other stock-based consideration arrangements associated with business acquisitions in accordance with the provisions of the authoritative accounting guidance, which requires the measurement and recognition of compensation expense based on estimated fair values.

The impact on the Company’s results of operations of recording stock-based compensation expense under its equity incentive plans and other stock-based consideration arrangements associated with business acquisitions, including the ESPP, were as follows:

The Company capitalized $2,336, $3,149 and $3,650 in stock-based compensation costs as part of internal use software during the years ended December 31, 2025, 2024 and 2023, respectively.

NOTE 23 - INCOME TAXES

The Company is subject to U.S. federal, state, and foreign income taxes. The components of income before income taxes for each of the years ended December 31, 2025, 2024 and 2023 were as follows:

The components of the provision for income taxes for each of the years ended December 31, 2025, 2024 and 2023 were as follows:

A reconciliation of the statutory U.S. federal income tax rate of 21% for the year ended December 31, 2025 to the effective income tax rate is as follows:

As previously disclosed for the years ended December 31, 2024 and 2023, prior to the adoption of ASU 2023-09, the following is a reconciliation between the effective income tax rate and the federal statutory tax rate:

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of long-term assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The components of the Company’s long-term net deferred tax assets were as follows:

Deferred taxes are determined utilizing the asset and liability method based on the estimated future tax effects of differences between the financial accounting and tax bases of assets and liabilities under the applicable tax laws. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. In evaluating the need for a valuation allowance, management takes into account various factors, including future reversals of existing taxable temporary differences, projected future taxable income by jurisdiction, tax planning strategies, and results of recent operations. Based on this evaluation, a valuation allowance of $19,359 and $19,180 has been recorded as of December 31, 2025 and 2024, respectively. As of December 31, 2025, the Company maintains a full valuation allowance on its deferred tax assets in Singapore, associated with the Skuad acquisition, and in Germany as management believes it is more likely than not that the deferred tax assets will not be utilized in these jurisdictions. In the determination of the appropriate valuation allowances, the Company has considered the most recent projections of future business results and taxable income by jurisdiction. Actual results may vary in comparison to current projections.

After consideration of the evidence described above, management believes it is more likely than not that deferred tax assets will be realized for the United States and the Israeli subsidiary.

As of December 31, 2025, the Company had state tax net operating loss carryforwards of $355. Though the Company’s state net operating loss carryforwards were insignificant as of December 31, 2025, these net operating losses can be utilized to reduce future taxable income, if any. Utilization of the net operating loss carryforwards may be subject to annual limitations under the tax laws of the different states. The annual limitation may result in the expiration of state net operating loss carryforwards before utilization. If not utilized, the state net operating loss carryforwards will begin to expire in 2029. The Company also has net operating losses in Germany of approximately $60,986, which may be carried forward indefinitely to offset future taxable income in Germany. It is more likely than not that the majority of the German net operating loss carryforwards will not be realized; therefore, the Company has recorded a valuation allowance against them.

Additionally, it should be noted that for the year ended December 31, 2025, provisions have not been made for income taxes on the undistributed earnings that were deemed permanently reinvested in foreign subsidiaries. Determination of the amount of unrecognized deferred tax liabilities on these earnings is not practicable because such liabilities, if any, depend on certain circumstances existing if and when remittance occurs. A deferred tax liability will be recognized if and when the Company no longer plans to permanently reinvest these undistributed earnings.

The below describes uncertain tax positions that would be recorded in the consolidated statements of comprehensive income as part of the income tax provision. A reconciliation of the beginning and ending amount of unrecognized tax benefits included in other non-current liabilities on the accompanying consolidated balance sheets of the Company is as follows:

The material uncertain tax positions relate to transfer pricing adjustments in foreign jurisdictions. As of December 31, 2025, the Company recorded gross unrecognized tax benefits of $57,083, all of which, if recognized, would affect the Company’s effective tax rate. The Company recognizes interest and penalties accrued on uncertain income tax positions as part of the income tax provision. During the years ended December 31, 2025, 2024 and 2023, the Company incurred penalties related to income taxes of $1, $186, and $38, respectively.

The following table presents the change in the Company’s valuation allowance during the periods presented:

Tax years from 2022 and forward remain open to examinations by US federal and state authorities. The Company is currently not under examination by the Internal Revenue Service. The Israeli subsidiary continues to be under tax examination for the 2021-2022 tax years. The Company will comply with the requests to the extent required by law.

Upon adoption of ASU 2023-09, as described in Note 2cc, cash paid for income taxes, net of refunds, during the year ended December 31, 2025, was as follows:

Cash paid for income taxes, net of refunds was $52,320 and $40,910 for the years ended December 31, 2024 and 2023, respectively.

NOTE 24 – NET EARNINGS PER SHARE

The Company computes net earnings per share using the two-class method required for participating securities. The two-class method requires income available to common shareholders for the period to be allocated between shares of Common Stock and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed.

The Company’s basic net earnings per share is calculated by dividing net income attributable to common shareholders by the weighted-average number of shares of common stock outstanding for the period, without consideration of potentially dilutive securities. The diluted net earnings per share is calculated by giving effect to all potentially dilutive securities outstanding for the period using the treasury share method or the if-converted method based on the nature of such securities. Diluted net earnings per share is the same as basic net earnings per share in periods when the effects of potentially dilutive shares of common stock are anti-dilutive. Instruments with an antidilutive effect, for which conditions were not met, or which were not in the money in the reporting period were excluded from the diluted net earnings per share calculation for the year ended December 31, 2025, 2024, and 2023. Refer below for details on specific exclusions.

Basic and diluted net earnings per share attributable to common stockholders were calculated as follows:

NOTE 24 – NET EARNINGS PER SHARE (continued):

Note the following shares have been excluded from the computation of diluted earnings per share for the years ended December 31, 2025, 2024 and 2023 as their effect was antidilutive, conditions were not met or they were not in the money in the reporting period.

1 As that term is defined in the Agreement and Plan of Reorganization dated February 3, 2021 (as amended) with FTAC Olympus Acquisition Corp.

2 Additionally, the outstanding ESPP shares as of December 31, 2025, 2024 and 2023, were not included as they would have been antidilutive.

NOTE 25 – SUBSEQUENT EVENTS

On January 19, 2026, the Company acquired 100% of the outstanding equity of Boundless Technologies Limited, an Ireland-based EOR platform that helps businesses seamlessly and compliantly employ people around the world. This acquisition marks another step in Payoneer’s strategy to deliver a comprehensive financial stack for SMBs that operate internationally.

The aggregate purchase price is approximately $13.0 million adjusted for certain holdbacks and is subject to customary post-closing adjustments. Additionally, the transaction includes an earn-out provision of up to $4 million contingent upon reaching certain performance and tenure milestones. Because the earn-out is contingent upon continued employment, it will be accounted for as compensation expense in accordance with ASC 718. The acquisition will be accounted for as a business combination under ASC 805.

Due to the acquiree’s insignificant size relative to the Company, the Company does not expect to provide supplemental pro forma information for the current and prior year reporting periods.