EURONET WORLDWIDE INC

Previous wording

Investors are cautioned that any forward-looking statements are not guarantees of future performance and involve risks and uncertainties. Actual results may materially differ from those in the forward-looking statements as a result of various factors, including, but not limited to, conditions in world financial markets and general economic conditions, including impacts from the COVID-19 or other pandemics; inflation; the war in the Ukraine, and related economic sanctions; military conflicts in the Middle East; our ability to successfully integrate any acquired operations; economic conditions in specific countries and regions; technological developments affecting the market for our products and services; our ability to successfully introduce new products and services; foreign currency exchange rate fluctuations; the effects of any breach of our computer systems or those of our customers or vendors, including our financial processing networks or those of other third parties; interruptions in any of our systems or those of our vendors or other third parties; our ability to renew existing contracts at profitable rates; changes in fees payable for transactions performed for cards bearing international logos or over switching networks such as card transactions on ATMs; our ability to comply with increasingly stringent regulatory requirements, including anti-money laundering, anti-terrorism, anti-bribery, sanctions, consumer and data protection and privacy and the European Union's General Data Protection Regulation, and Second Revised Payment Service Directive requirements; changes in laws and regulations affecting our business, including tax and immigration laws and any laws regulating payments, including DCC transactions; changes in our relationships with, or in fees charged by, our business partners; competition; the outcome of claims and other loss contingencies affecting Euronet; the cost of borrowing (including fluctuations in interest rates), availability of credit and terms of and compliance with debt covenants; and renewal of sources of funding as they expire and the availability of replacement funding and those factors referred to above and as set forth and more fully described in Part I, Item 1 A — Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2023. Our Annual Report on Form 10-K is available on the SEC's EDGAR website at www.sec.gov, and copies may also be obtained by contacting the Company. Any forward-looking statements made in this Form 10-Q speak only as of the date of this report. Except as required by law, we do not intend, and do not undertake any obligation, to update any forward-looking statements to reflect future events or circumstances after the date of such statements.

Current wording

Investors are cautioned that any forward-looking statements are not guarantees of future performance and involve risks and uncertainties. Actual results may materially differ from those in the forward-looking statements as a result of various factors, including, but not limited to, conditions in world financial markets and general economic conditions, including impacts from the COVID-19 or other pandemics; inflation; the war in the Ukraine, and related economic sanctions; military conflicts in the Middle East; our ability to successfully integrate any acquired operations; economic conditions in specific countries and regions; technological developments affecting the market for our products and services; our ability to successfully introduce new products and services; foreign currency exchange rate fluctuations; the effects of any breach of our computer systems or those of our customers or vendors, including our financial processing networks or those of other third parties; interruptions in any of our systems or those of our vendors or other third parties; our ability to renew existing contracts at profitable rates; changes in fees payable for transactions performed for cards bearing international logos or over switching networks such as card transactions on ATMs; our ability to comply with increasingly stringent regulatory requirements, including anti-money laundering, anti-terrorism, anti-bribery, sanctions, consumer and data protection and privacy and the European Union's General Data Protection Regulation, and Second Revised Payment Service Directive requirements; changes in laws and regulations affecting our business, including tax and immigration laws and any laws regulating payments, including Dynamic Currency Conversion (DCC) transactions; changes in our relationships with, or in fees charged by, our business partners; competition; the outcome of claims and other loss contingencies affecting Euronet; the cost of borrowing (including fluctuations in interest rates), availability of credit and terms of and compliance with debt covenants; and renewal of sources of funding as they expire and the availability of replacement funding and those factors referred to above and as set forth and more fully described in Part I, Item 1 A — Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2023. Our Annual Report on Form 10-K is available on the SEC's EDGAR website at www.sec.gov, and copies may also be obtained by contacting the Company. Any forward-looking statements made in this Form 10-Q speak only as of the date of this report. Except as required by law, we do not intend, and do not undertake any obligation, to update any forward-looking statements to reflect future events or circumstances after the date of such statements.

Previous wording

1)The EFT Processing Segment meets the needs of financial institutions and consumers through Euronet-owned and outsourced ATMs and POS terminals combined with value added and transaction processing services. We deploy and operate our own ATMs, providing ATM services for financial institutions and providing electronic payment processing solutions. EFT offers a suite of integrated electronic financial transaction software solutions for electronic payment and transaction delivery systems. Transactions processed spana network of 49,290 active ATMs and approximately 713,000 POS terminals.

Current wording

1)The EFT Processing Segment meets the needs of financial institutions and consumers through Euronet-owned and outsourced ATMs and POS terminals combined with value added and transaction processing services. We deploy and operate our own ATMs, providing ATM services for financial institutions and providing electronic payment processing solutions. EFT offers a suite of integrated electronic financial transaction software solutions for electronic payment and transaction delivery systems. Transactions processed spana network of 54,005 active ATMs and approximately 833,000 POS terminals.

Previous wording

2)The epay Segment provides retail payment solutions and delivers innovative connections between the digital content of the world’s leading brands and consumers. epay has one of the largest retail networks across Europe and Asia for the distribution of physical and digital third-party content, including branded payments, mobile, and alternative payments, partnering with 1,000+ of the world’s leading brands. In addition, through our own products, we have leveraged our technology to solve business challenges, delivering scalable solutions to drive efficiency and effectiveness. Our comprehensive range of consumer products simplifies transactions and provides financial convenience across a wide range of branded payments. epay operates in 60+ countries. We operate a network that includes approximately 808,000 POS terminals that enable electronic processing of prepaid mobile airtime "top-up" services and other digital media content.

Current wording

2)The epay Segment provides retail payment solutions and delivers innovative connections between the digital content of the world’s leading brands and consumers. epay hasone of the largest retail networks across Europe and Asia for the distribution of physical and digital third-party content, including branded payments, mobile, and alternative payments, partnering with 1,000+ of the world’s leading brands. In addition, through our own products, we have leveraged our technology to solve business challenges, delivering scalable solutions to drive efficiency and effectiveness. Our comprehensive range of consumer products simplifies transactions and provides financial convenience across a wide range of branded payments. epay operates in 60+ countries. We operate a network that includes approximately 794,000 POS terminals that enable electronic processing of prepaid mobile airtime "top-up" services and other digital media content.

Previous wording

EFT Processing Segment — Revenues in the EFT Processing Segment, which represented approximately 25% of total consolidated revenues for thethree months ended March 31, 2024 are derived from fees charged for transactions made by cardholders on our proprietary network of ATMs, fixed management fees and transaction fees we charge to customers for operating ATMs and processing debit and credit cards under outsourcing and cross-border acquiring agreements, foreign currency exchange margin on DCC transactions, domestic and international surcharge, foreign currency dispensing and other value added services such as advertising, prepaid telecommunication recharges, bill payment, and money transfers provided over ATMs. Revenues in this segment are also derived from cardless payment, banknote recycling, tax refund services, license fees, professional services and maintenance fees for proprietary application software and sales of related hardware.

Current wording

EFT Processing Segment — Revenues in the EFT Processing Segment, which represented approximately 31% and 28% of total consolidated revenues for thethree and six months ended June 30, 2024 are derived from fees charged for transactions made by cardholders on our proprietary network of ATMs, fixed management fees and transaction fees we charge to customers for operating ATMs and processing debit and credit cards under outsourcing and cross-border acquiring agreements, foreign currency exchange margin on DCC transactions, domestic and international surcharge, foreign currency dispensing and other value added services such as advertising, prepaid telecommunication recharges, bill payment, and money transfers provided over ATMs. Revenues in this segment are also derived from cardless payment, banknote recycling, tax refund services, license fees, professional services and maintenance fees for proprietary application software and sales of related hardware.

Previous wording

epay Segment —Revenues in the epay Segment, which represented approximately 30% of total consolidated revenues for thethree months ended March 31, 2024 are primarily derived from commissions or processing fees received from mobile phone operators for the processing and distribution of prepaid mobile airtime and commissions earned from the distribution of other electronic content, vouchers, and physical gifts. The proportion of epay Segment revenues earned from the distribution of prepaid mobile phone time as compared with other electronic products has decreased over time, and digital media content now produces approximately 67% of epay Segment revenues. Other electronic content offered by this segment includes digital content such as music, games, and software, as well as other products including prepaid long distance calling card plans, prepaid Internet plans, prepaid debit cards, gift cards, vouchers, transport payments, lottery payments, bill payment, and money transfer.

Current wording

epay Segment —Revenues in the epay Segment, which represented approximately 26% and 28% of total consolidated revenues for thethree and six months ended June 30, 2024 are primarily derived from commissions or processing fees received from mobile phone operators for the processing and distribution of prepaid mobile airtime and commissions earned from the distribution of other electronic content, vouchers, and physical gifts. The proportion of epay Segment revenues earned from the distribution of prepaid mobile phone time as compared with other electronic products has decreased over time, and digital media content now produces approximately 66% of epay Segment revenues. Other electronic content offered by this segment includes digital content such as music, games, and software, as well as other products including prepaid long distance calling card plans, prepaid Internet plans, prepaid debit cards, gift cards, vouchers, transport payments, lottery payments, bill payment, and money transfer.

Previous wording

Money Transfer Segment —Revenues in the Money Transfer Segment, which represented approximately 45% of total consolidated revenues for thethree months ended March 31, 2024, respectively, are primarily derived from transaction fees, as well as the margin earned from purchasing foreign currency at wholesale exchange rates and selling the foreign currency to customers at retail exchange rates. We have a sending agent network in place comprised of agents, customer service representatives, Company-owned stores, primarily in North America, Europe and Malaysia, Ria, and xe branded websites, along with a worldwide network of correspondent agents, consisting primarily of financial institutions in the transfer destination countries. Under the brand "Dandelion", Ria offers payment processing services to third party partners. The Dandelion cross-border payments platform provides financial institutions, fintechs such as digital wallets and banks, and enterprise software companies access to Euronet's money transfer network through an API connection. Sending and correspondent agents each earn fees for cash collection and distribution services, which are recognized as direct operating costs at the time of sale. .

Current wording

Money Transfer Segment —Revenues in the Money Transfer Segment, which represented approximately 43% and 44% of total consolidated revenues for thethree and six months ended June 30, 2024, respectively, are primarily derived from transaction fees, as well as the margin earned from purchasing foreign currency at wholesale exchange rates and selling the foreign currency to customers at retail exchange rates. We have a sending agent network in place comprised of agents, customer service representatives, Company-owned stores, primarily in North America, Europe and Malaysia, Ria, and xe branded websites, along with a worldwide network of correspondent agents, consisting primarily of financial institutions in the transfer destination countries. Under the brand "Dandelion", Ria offers payment processing services to third party partners. The Dandelion cross-border payments platform provides financial institutions, fintechs such as digital wallets and banks, and enterprise software companies access to Euronet's money transfer network through an API connection. Sending and correspondent agents each earn fees for cash collection and distribution services, which are recognized as direct operating costs at the time of sale.

Previous wording

Revenues and operating income by segment for the three months ended March 31, 2024 and 2023 are summarized in the tables below:

Current wording

Revenues and operating income by segment for the three and six months ended June 30, 2024 and 2023 are summarized in the tables below:

Previous wording

COMPARISON OF OPERATING RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2024 AND 2023

Current wording

COMPARISON OF OPERATING RESULTS FOR THETHREE AND SIXMONTHS ENDED JUNE 30, 2024 AND 2023

Previous wording

The following table summarizes the results of operations for our EFT Processing Segment for the three months ended March 31, 2024 and 2023:

Current wording

The following table summarizes the results of operations for our EFT Processing Segment for the three and six months ended June 30, 2024 and 2023:

Previous wording

EFT Processing Segment total revenues were$217.2 million for thethree months ended March 31, 2024, anincrease of$25.0 million or 13%compared to the same period in 2023. Theincrease in revenues was primarily due to the increase in domestic and international cash withdrawal transactions resulting from the increase in travel bringing more tourists, the increase in low-value point-of-sale transactions in Europe and low-value payment processing transactions in Asia Pacific. Fluctuations in foreign currency exchange rates increased revenues by approximately $1.3 million for thethree months ended March 31, 2024 compared to the same period in 2023.

Current wording

EFT Processing Segment total revenues were$305.4 million for thethree months ended June 30, 2024, anincrease of$23.0 million or 8%compared to the same period in 2023. EFT Processing Segment total revenues were $522.6 million for thesix months ended June 30, 2024, anincrease of $48.0 million or 10% compared to the same period in 2023. Theincrease in revenues was primarily due to the increase in POS acquiring transactions, entering new geographic markets, increase in domestic and international cash withdrawal transactions resulting from the increase in travel bringing more tourists, the increase in low-value point-of-sale transactions in Europe and low-value payment processing transactions in Asia Pacific. Fluctuations in foreign currency exchange rates increased revenues by approximately $4.4 million and $0.5 million for thethree and six months ended June 30, 2024 compared to the same periods in 2023.

Previous wording

EFT Processing Segment direct operating costs were$131.1 million for thethree months ended March 31, 2024, anincrease of$12.1 million or 10% compared to the same period in 2023. Direct operating costs primarily consist of site rental fees, cash delivery costs, cash supply costs, maintenance, insurance, telecommunications, payment scheme processing fees, data center operations-related personnel, as well as the processing centers’ facility-related costs and other processing center-related expenses and commissions paid to retail merchants, banks and card processors.

Current wording

EFT Processing Segment direct operating costs were$152.5 million for thethree months ended June 30, 2024, anincrease of$10.4 million or 7% compared to the same period in 2023. EFT Processing Segment direct operating costs were$283.6 million for thesix months ended June 30, 2024, anincrease of$22.5 million or 9% compared to the same period in 2023. Direct operating costs primarily consist of site rental fees, cash delivery costs, cash supply costs, maintenance, insurance, telecommunications, payment scheme processing fees, data center operations-related personnel, as well as the processing centers’ facility-related costs and other processing center-related expenses and commissions paid to retail merchants, banks and card processors.

Previous wording

The increase in direct costs was primarily due to the increase in number of ATMs, and an increase in high volume low value cash transactions in Asia Pacific. Fluctuations in foreign currency exchange rates increased direct operating costs by approximately $1.7 million for thethree months ended March 31, 2024 compared to the same period in 2023.

Current wording

The increase in direct costs was primarily due to the increase in number of ATMs, and an increase in high volume low value cash transactions in Asia Pacific. Furthermore, direct costs are increasing due to higher funding costs and higher scheme costs. Fluctuations in foreign currency exchange rates increased direct operating costs by approximately $1.7 million and $0.1 million for thethree and six months ended June 30, 2024 compared to the same periods in 2023.

Previous wording

Gross profit, which is calculated as revenues less direct operating costs, was $86.1 million for thethree months ended March 31, 2024, anincrease of $12.9 million or 18% compared to $73.2 million for the same period in 2023. Gross profit as a percentage of revenues (“gross margin”) increased to 39.6% for thethree months ended March 31, 2024, compared to 38.1% for the same period in 2023. The increase in gross profit was primarily due to the increase in domestic and international cash withdrawal transactions resulting from the increase in travel bringing more tourists, the increase in low-value point-of-sale transactions in Europe and low-value payment processing transactions in Asia Pacific.

Current wording

Gross profit, which is calculated as revenues less direct operating costs, was $152.9 million for thethree months ended June 30, 2024, anincrease of $12.6 million or 9% compared to $140.3 million for the same period in 2023. Gross profit was $239.0 million for thesix months ended June 30, 2024, anincrease of $25.5 million or 12% compared to $213.5 million for the same period in 2023. Gross profit as a percentage of revenues (“gross margin”) increased to 50.1% and 45.7% for the three andsix months ended June 30, 2024, compared to 49.7% and 45.0% for the same periods in 2023. The increase in gross profit was primarily due to theincrease in POS acquiring transactions, entering new geographic markets, increase in domestic and international cash withdrawal transactions resulting from the increase in travel bringing more tourists, the increase in low-value point-of-sale transactions in Europe and low-value payment processing transactions in Asia Pacific.

Previous wording

Salaries and benefits expenses were $31.8 million for thethree months ended March 31, 2024, anincrease of$4.3 million or 16% compared to the same period in 2023. The increase is primarily due to an increase in headcount to support the growth of the business and salary increases due to inflationary pressures. Fluctuations in foreign currency exchange rates in the countries in which we employ our workforce increased salaries by approximately $0.3 million for thethree months ended March 31, 2024 As a percentage of revenues, salary expense increased to 14.6%for thethree months ended March 31, 2024, compared to 14.3% forthe same period in 2023.

Current wording

Salaries and benefits expenses were $34.4 million for thethree months ended June 30, 2024, anincrease of$3.6 million or 12% compared to the same period in 2023. Salaries and benefits expenses were $66.2 million for thesix months ended June 30, 2024, anincrease of $7.9 million or 14% compared to the same period in 2023. The increase is primarily due to an increase in headcount to support the growth of the business and salary increases due to inflationary and market pressures. As a percentage of revenues, salary expense increased to 11.3% and 12.7%for thethree and six months ended June 30, 2024, compared to 10.9% and 12.3%forthe same periods in 2023.

Previous wording

Selling, general and administrative expenses were $9.2 million for the three months ended March 31, 2024, adecrease of $6.9 million or 43% compared to the same period in 2023. The decrease was primarily due to a decrease in professional fees and the refund of a duty fee. As a percentage of revenues, these expenses decreased to 4.2%for thethree months ended March 31, 2024, compared to 8.4%for the same period in 2023.

Current wording

Selling, general and administrative expenses were $13.5 million for the three months ended June 30, 2024, adecrease of $3.1 million or 19% compared to the same period in 2023. Selling, general and administrative expenses were $22.7 million for thesix months ended June 30, 2024, adecrease of $10.0 million or 31% compared to the same period in 2023. The decrease was primarily due to a decrease in professional fees and the refund of a duty fee in the first quarter of 2024. As a percentage of revenues, these expenses decreased to 4.4% and 4.3%for thethree and six months ended June 30, 2024, compared to 5.9% and 6.9%for the same periods in 2023.

Previous wording

EFT Processing Segment had operating incomeof$21.5 million for thethree months ended March 31, 2024, anincrease of $14.6 million or 212% compared to the same period in 2023. Operating income as a percentage of revenues (“operating margin”) increased to 9.9% for thethree months ended March 31, 2024, compared to 3.6%for the same period in 2023. The increasein operating income was primarily due to a decrease in professional fees and the refund of a duty fee paid and expensed during 2023.

Current wording

EFT Processing Segment had operating incomeof$79.9 million for thethree months ended June 30, 2024, anincrease of $10.8 million or 16% compared to the same period in 2023. EFT Processing Segment had operating income of $101.4 million for thesix months ended June 30, 2024, anincrease of $25.4 million or 33% compared to the same period in 2023. Operating income as a percentage of revenues (“operating margin”) increased to 26.2% and 19.4%for thethree and six months ended June 30, 2024, compared to 24.5% and 16.0%for the same periods in 2023. The increasein operating income (and operating margin) was primarily due to improved business performance compared to 2023.

Previous wording

The following table presents the results of operations for the three months ended March 31, 2024 and 2023 for our epay Segment:

Current wording

The following table presents the results of operations for the three and six months ended June 30, 2024 and 2023 for our epay Segment:

Previous wording

epay Segment total revenues were$257.1 million for thethree months ended March 31, 2024, anincrease of$19.7 million or 8%compared to the same period in 2023. The increase in revenue for thethree months ended March 31, 2024 was driven by continued expansion in mobile and digital branded payments. Fluctuations in foreign currency exchange rates increased revenue by approximately $1.2 millionfor thethree months ended March 31, 2024, compared to the same period in 2023.

Current wording

epay Segment total revenues were$260.9 million for thethree months ended June 30, 2024, adecrease of$2.9 million or 1%compared to the same period in 2023. epay Segment total revenues were $518.0 million for thesix months ended June 30, 2024, anincrease of $16.8 million or 3% compared to the same period in 2023. The increase in revenue for thesix months ended June 30, 2024 was driven by continued expansion in mobile and digital branded payments. Fluctuations in foreign currency exchange rates increased revenue by approximately $3.8 millionfor the three months ended June 30, 2024, compared to the same period in 2023. Fluctuations inforeign currency exchange rates did not have a material impact on revenues for the six months ended June 30, 2024, compared to the same period in 2023.

Previous wording

epay Segment direct operating costs were$195.1 million for thethree months ended March 31, 2024, anincrease of $17.0 million or 10% compared to the same period in 2023. Direct operating costs primarily consist of the commissions paid to retail merchants for the distribution and sale of prepaid mobile airtime and other prepaid products, expenses incurred to operate POS terminals and the cost of vouchers sold and physical gifts fulfilled. Foreign currency exchange rates increased direct operating costs by$1.2 millionfor thethree months ended March 31, 2024 compared to the same period in 2023. The increase in direct operating costs was the result of increase in business activity and inflationary pressure.

Current wording

epay Segment direct operating costs were$198.5 million for thethree months ended June 30, 2024, adecrease of $5.7 million or 3% compared to the same period in 2023. epay Segment direct operating costs were $393.6 million for thesix months ended June 30, 2024, anincrease of $11.3 million or 3% compared to the same period in 2023. Direct operating costs primarily consist of the commissions paid to retail merchants for the distribution and sale of prepaid mobile airtime and other prepaid products, expenses incurred to operate POS terminals and the cost of vouchers sold and physical gifts fulfilled. Fluctuations in foreign currency exchange rates increased direct operating costs by approximately $2.8 millionfor the three months ended June 30, 2024, compared to the same period in 2023. Fluctuations inforeign currency exchange rates did not have a material impact on direct operating costs for the six months ended June 30, 2024, compared to the same period in 2023.

Previous wording

Gross profit was$62.0 million for thethree months ended March 31, 2024, anincrease of $2.7 million or 5% compared to $59.3 million for the same period in 2023. Gross margin decreased to 24.1% for thethree months ended March 31, 2024, compared to 25.0% for the same period in 2023. The changes in gross profit and gross margin were primarily due to the shift in the mix of transactions processed.

Current wording

Gross profit was$62.4 million for thethree months ended June 30, 2024, anincrease of $2.8 million or 5% compared to $59.6 million for the same period in 2023. Gross profit was $124.4 million for thesix months ended June 30, 2024, anincrease of $5.5 million or 5% compared to $118.9 million for the same period in 2023. Gross margin increased to 23.9% and 24.0% for thethree and six months ended June 30, 2024, compared to 22.6% and 23.7% for the same periods in 2023. The changes in gross profit and gross margin were primarily due to the shift in the mix of transactions processed.

Previous wording

Salaries and benefits expenses were$24.1 million for thethree months ended March 31, 2024, anincrease of$2.7 million or 13% compared to the same period in 2023. The fluctuations in salaries and benefits were driven by an increase in headcount to support the growth of the business and salary increases due to inflationary pressures. As a percentage of revenues, these expenses increased to 9.4% for thethree months ended March 31, 2024, compared to 9.0%for the same period in 2023. Fluctuations in foreign currency exchange rates in the countries in which we employ our workforce increased salaries by approximately $0.2 million for the three months ended March 31, 2024 as compared to the same period in 2023.

Current wording

Salaries and benefits expenses were$25.1 million for thethree months ended June 30, 2024, anincrease of$3.1 million or 14% compared to the same period in 2023. Salaries and benefits expenses were $49.2 million for thesix months ended June 30, 2024, anincrease of $5.8 million or 13% compared to the same period in 2023. The fluctuations in salaries and benefits were driven by an increase in headcount to support the growth of the business and salary increases due to inflationary pressures. As a percentage of revenues, these expenses increased to 9.6% and 9.5%for thethree and six months ended June 30, 2024, compared to 8.3% and 8.7%for the same periods in 2023.

Previous wording

Depreciation and amortization expenses were$1.7 million for thethree months ended March 31, 2024, anincrease of $0.1 million or 6%compared to the same period in 2023. Depreciation and amortization expense primarily represents depreciation of POS terminals we install in retail stores and amortization of acquired intangible assets. As a percentage of revenues, these expenses were 0.7% for both thethree months ended March 31, 2024, and for the same period in 2023.

Current wording

Depreciation and amortization expenses were$1.8 million for thethree months ended June 30, 2024, anincrease of $0.1 million or 6%compared to the same period in 2023. Depreciation and amortization expenses were $3.5 million for thesix months ended June 30, 2024 an increase of $0.2 million or 6% compared to the same period in 2023. Depreciation and amortization expense primarily represents depreciation of POS terminals we install in retail stores and amortization of acquired intangible assets. As a percentage of revenues, these expenses were 0.7% for both thethree and six months ended June 30, 2024, respectively, compared to 0.6% and 0.7% for the same periods in 2023.

Previous wording

epay Segment operating income was $26.6 million for thethree months ended March 31, 2024, adecrease of $0.9 million or 3% compared to the same period in 2023. Operating margin decreased to 10.3% for thethree months ended March 31, 2024, compared to 11.6% for the same period in 2023. Operating income per transaction was$0.03 for both thethree months ended March 31, 2024 and the same period in 2023. Changesin operating income and operating margin for thethree months ended March 31, 2024 compared to the same period in 2023 were primarily due tothe shift in the mix of transactions processed and a decline in the promotional campaign activity this quarter compared to the same period last year.

Current wording

epay Segment operating income was $26.2 million for thethree months ended June 30, 2024, adecrease of $0.6 million or 2% compared to the same period in 2023. epay Segment operating income was $52.8 million for thesix months ended June 30, 2024, adecrease of $1.5 million or 3% compared to the same period in 2023. Operating margin decreased to 10.0% and 10.2% for thethree and six months ended June 30, 2024, compared to 10.2% and 10.8% for the same periods in 2023. Operating income per transaction was$0.02 and $0.03 for thethree and six months ended June 30, 2024, respectively compared to $0.03 and $0.03 for the same periods in 2023. Changesin operating income and operating margin for thethree and six months ended June 30, 2024 compared to the same periods in 2023 were primarily due tothe shift in the mix of transactions processed and a decline in the promotional campaign activity this quarter compared to the same period last year.

Previous wording

The following table presents the results of operations for thethree months ended March 31, 2024 and 2023 for the Money Transfer Segment:

Current wording

The following table presents the results of operations for thethree and six months ended June 30, 2024 and 2023 for the Money Transfer Segment:

Previous wording

Money Transfer Segment total revenues were $384.6 million for thethree months ended March 31, 2024, anincrease of$25.2 million or 7%compared to the same period in 2023. The increase in revenues was primarily due to an increase in international-originated money transfers, U.S. outbound transactions, and direct-to-consumer digital transactions, partially offset by a decrease in U.S. domestic transactions. Revenues per transaction decreased to $9.47 for thethree months ended March 31, 2024, compared to $9.57 for the same period in 2023 due to a shift in the mix of transactions processed.

Current wording

Money Transfer Segment total revenues were $421.8 million for thethree months ended June 30, 2024, anincrease of$27.0 million or 7%compared to the same period in 2023. Money Transfer Segment total revenues were $806.4 million for thesix months ended June 30, 2024, anincrease of $52.2 million or 7% compared to the same period in 2023. The increase in revenues was primarily due to an increase in international-originated money transfers, U.S. outbound transactions, and direct-to-consumer digital transactions, partially offset by a decrease in U.S. domestic transactions. Revenues per transaction decreased to $9.52 and $9.50 for thethree and six months ended June 30, 2024, compared to $9.61 and $9.60 for the same periods in 2023 due to a shift in the mix of transactions processed. Fluctuations in foreign currency exchange rates increased revenues by approximately $3.8 million and $0.1 million for the three and six months ended June 30, 2024 compared to the same periods in 2023.

Previous wording

Money Transfer Segment direct operating costs were$209.4 million for thethree months ended March 31, 2024, anincrease of 13.1 million or 7% compared to the same period in 2023. Direct operating costs primarily consist of commissions paid to agents who originate money transfers on our behalf and correspondent agents who disburse funds to the customers’ destination beneficiaries, together with less significant costs, such as bank depository fees. The increase in direct operating costs was primarily due to the increase in the number ofinternational-originated and U.S. outbound money transfer transactions.

Current wording

Money Transfer Segment direct operating costs were$231.7 million for thethree months ended June 30, 2024, anincrease of $18.0 million or 8% compared to the same period in 2023. Money Transfer Segment direct operating costs were $441.1 million for thesix months ended June 30, 2024, anincrease of $31.1 million or 8% compared to the same period in 2023. Direct operating costs primarily consist of commissions paid to agents who originate money transfers on our behalf and correspondent agents who disburse funds to the customers’ destination beneficiaries, together with less significant costs, such as bank depository fees. The increase in direct operating costs was primarily due to the increase in the number ofinternational-originated and U.S. outbound money transfer transactions. Fluctuations in foreign currency exchange rates changed direct costs by approximately $1.7 million and ($0.1) million for the three and six months ended June 30, 2024 compared to the same periods in 2023.

Previous wording

Gross profit was $175.2 million for thethree months ended March 31, 2024, anincrease of $12.1 million or 7% compared to $163.1 million for the same period in 2023. Gross margin increased to 45.6% for thethree months ended March 31, 2024, compared to 45.4% for the same period in 2023. The increase in gross profit and gross margin was primarily due to increases in international-originated money transfers, U.S. outbound transactions and direct-to-consumer digital transactions.

Current wording

Gross profit was $190.1 million for thethree months ended June 30, 2024, anincrease of $9.0 million or 5% compared to $181.1 million for the same period in 2023. Gross profit was $365.3 million for thesix months ended June 30, 2024, anincrease of $21.1 million or 6% compared to $344.2 million for the same period in 2023. Gross margin decreased to 45.1% and 45.3% for thethree and six months ended June 30, 2024, compared to 45.9% and 45.6% for the same periods in 2023. The increase in gross profit was primarily due to increases in international-originated money transfers, U.S. outbound transactions and direct-to-consumer digital transactions.

Previous wording

Salaries and benefits expenses were $80.7 million for thethree months ended March 31, 2024, anincrease of $6.4 million or 9% compared tothe same period in 2023. The increase in salaries and benefits was primarily driven by an increase in headcount to support the growth of the business and salary increases due to inflationary pressures. As a percentage of revenues, these expenses increased to 21.0%for thethree months ended March 31, 2024, compared to 20.7%, for the same period in 2023. Fluctuations in foreign currency exchange rates in the countries in which we employ our workforce increased salaries by approximately $0.3 million for the three months ended March 31, 2024, as compared to the same period in 2023.

Current wording

Salaries and benefits expenses were $82.7 million for thethree months ended June 30, 2024, anincrease of $4.2 million or 5% compared tothe same period in 2023. Salaries and benefits expenses were $163.4 million for thesix months ended June 30, 2024, anincrease of $10.6 million or 7% compared to the same period in 2023. The increase in salaries and benefits was primarily driven by an increase in headcount to support the growth of the business and salary increases due to inflationary pressures. As a percentage of revenues, these expenses decreased to 19.6% and 20.3%for thethree and six months ended June 30, 2024, compared to 19.9% and 20.3%for the same periods in 2023.

Previous wording

Depreciation and amortization expenses were $7.3 million for thethree months ended March 31, 2024, adecrease of$1.2 million or 14%compared to the same period in 2023. Depreciation and amortization expense primarily represents amortization of acquired intangible assets and depreciation of money transfer terminals, computers and software, leasehold improvements and office equipment. As a percentage of revenues, these expenses decreased to 1.9%for thethree months ended March 31, 2024, compared to 2.4% for the same period in 2023.

Current wording

Depreciation and amortization expenses were $6.7 million for thethree months ended June 30, 2024, adecrease of$1.4 million or 17%compared to the same period in 2023. Depreciation and amortization expenses were $14.0 million for thesix months ended June 30, 2024, adecrease of $2.6 million or 16% compared to the same period in 2023. Depreciation and amortization expense primarily represents amortization of acquired intangible assets and depreciation of money transfer terminals, computers and software, leasehold improvements and office equipment. As a percentage of revenues, these expenses decreased to 1.6% and 1.7%for thethree and six months ended June 30, 2024, compared to 2.1% and 2.2% for the same periods in 2023.

Previous wording

The following table presents the operating expenses for the three months ended March 31, 2024 and 2023 for Corporate Services:

Current wording

The following table presents the operating expenses for the three and six months ended June 30, 2024 and 2023 for Corporate Services:

Previous wording

Total Corporate operating expenses were $21.3 million for thethree months ended March 31, 2024, adecrease of $0.1 million compared to the same period in 2023.

Current wording

Total Corporate operating expenses were $19.1 million and $40.4 million for thethree and six months ended June 30, 2024, adecrease of $1.4 million or 7% and $1.5 million or 4% compared to the same periods in 2023.

Previous wording

Interest income was $5.7 million for the three months ended March 31, 2024, anincrease of $3.1 million or 119% compared to the same period in 2023. This increase was driven by an increase in interest rates on our interest bearing bank accounts.

Current wording

Interest income was $5.9 million for the three months ended June 30, 2024, anincrease of $2.4 million or 69% compared to the same period in 2023. Interest income was $11.6 million for thesix months ended June 30, 2024, anincrease of $5.5 million or 90% compared to the same period in 2023. This increase was driven by an increase in interest rates on our interest bearing bank accounts.

Previous wording

Interest expense was $14.9 million for the three months ended March 31, 2024, anincrease of $4.8 million or 48% compared to the same period in 2023. This increase was driven by an increase in interest rates on our Credit Facility and uncommitted credit facility.

Current wording

Interest expense was $20.1 million for the three months ended June 30, 2024, anincrease of $6.1 million or 44% compared to the same period in 2023. Interest expense was $35.0 million for thesix months ended June 30, 2024, anincrease of $10.9 million or 45% compared to the same period in 2023. This increase was driven by an increase in interest rates and outstanding balances on our Credit Facility and uncommitted credit facilities.

Previous wording

We recorded net foreign currency exchange losses of$12.5 million for thethree months ended March 31, 2024, compared to net foreign currency exchange losses of $1.1 million for the same period in 2023. These realized and unrealized foreign currency exchange losses reflect the fluctuation in the value of the U.S. dollar against the currencies of the countries in which we operated during the respective period.

Current wording

We recorded net foreign currency exchange income of$1.5 million and loss of ($11.0) millionfor thethree and six months ended June 30, 2024, compared to net foreign currency exchange income of $6.3 million and $5.2 million for the same periods in 2023. These realized and unrealized foreign currency exchange losses reflect the fluctuation in the value of the U.S. dollar against the currencies of the countries in which we operated during the respective period.

Previous wording

The Company's effective income tax rate was 37.9% for thethree months ended March 31, 2024, compared to 46.5% for the same period ended March 31, 2023. The Company's effective income tax rate for thethree months ended March 31, 2024 was higher than the applicable statutory income tax rate of 21% as a result of certain foreign earnings being subject to higher local statutory tax rates and the Company’s U.S. deferred tax activity.

Current wording

The Company's effective income tax rate was 32.0% and 33.5% for thethree and six months ended June 30, 2024, compared to 27.3% and 31.9% for the same periods ended June 30, 2023. The Company's effective income tax rate for thethree and six months ended June 30, 2024 was higher than the applicable statutory income tax rate of 21% as a result of certain foreign earnings being subject to higher local statutory tax rates and the Company’s U.S. deferred tax activity.

Previous wording

As of March 31, 2024, we had working capital of$970.7 million, which is calculated as the difference between total current assets and total current liabilities, compared to working capital of $1,462.1 million as of December 31, 2023. Thedecrease in working capital was primarily due to the net effect of the classification of the convertible debt to current liabilities, positive operational results, the Infinitium acquisition completed during the quarter and working capital changes. Our ratio of current assets to current liabilities was 1.33 and 1.54 at March 31, 2024 and December 31, 2023, respectively.

Current wording

As of June 30, 2024, we had working capital of$694.9 million, which is calculated as the difference between total current assets and total current liabilities, compared to working capital of $1,462.1 million as of December 31, 2023. Thedecrease in working capital was primarily due to the net effect of the classification of the convertible debt to current liabilities, additional financing for the ATMs, positive operational results, acquisitions, repurchases of shares and working capital changes. Our ratio of current assets to current liabilities was 1.19 and 1.54 at June 30, 2024 and December 31, 2023, respectively.

Previous wording

We require substantial working capital to finance operations. The Money Transfer Segment funds the payout of the majority of our consumer-to-consumer money transfer services before receiving the benefit of amounts collected from customers by agents. Working capital needs increase in order to cover weekends and banking holidays. As a result, we may report more or less working capital for the Money Transfer Segment based solely upon the day on which the reporting period ends. The epay Segment produces positive working capital, some of which is restricted in connection with the administration of its customer collection and vendor remittance activities. In our EFT Processing Segment, we obtain a significant portion of the cash required to operate our ATMs through various cash supply arrangements, the amount of which is not recorded on Euronet's Consolidated Balance Sheets. However, in certain countries, we fund the cash required to operate our ATM network from borrowings under our revolving credit facilities, uncommitted credit agreements and cash flows from operations. As of March 31, 2024, we had$599.7 millionof our own cash in use or designated for use in our ATM network, which is recorded in ATM cash on Euronet's Consolidated Balance Sheet. ATM cash increased $74.5 million from $525.2 million as of December 31, 2023 to$599.7 million as of March 31, 2024 as a result of the increase in number of active ATMs as of March 31, 2024 compared to December 31, 2023. The Company has$1,236.2 millionof unrestricted cash as of March 31, 2024 compared to $1,254.2 million as of December 31, 2023. Including the$599.7 millionof cash in ATMs at March 31, 2024, we have access to$2,214.3 millionin available cash, and $579.0 million available under the Credit Facility with no significant long-term debt principal payments until March 2025.

Current wording

We require substantial working capital to finance operations. The Money Transfer Segment funds the payout of the majority of our consumer-to-consumer money transfer services before receiving the benefit of amounts collected from customers by agents. Working capital needs increase in order to cover weekends and banking holidays. As a result, we may report more or less working capital for the Money Transfer Segment based solely upon the day on which the reporting period ends. The epay Segment produces positive working capital, some of which is restricted in connection with the administration of its customer collection and vendor remittance activities. In our EFT Processing Segment, we obtain a significant portion of the cash required to operate our ATMs through various cash supply arrangements, the amount of which is not recorded on Euronet's Consolidated Balance Sheets. However, in certain countries, we fund the cash required to operate our ATM network from borrowings under our revolving credit facilities, uncommitted credit agreements and cash flows from operations. As of June 30, 2024, we had$795.6 millionof our own cash in use or designated for use in our ATM network, which is recorded in ATM cash on Euronet's Consolidated Balance Sheet. ATM cash increased $270.4 million from $525.2 million as of December 31, 2023 to$795.6 million as of June 30, 2024 as a result of the increase in number of active ATMs as of June 30, 2024 compared to December 31, 2023. The Company has$1,271.8 millionof unrestricted cash as of June 30, 2024 compared to $1,254.2 million as of December 31, 2023. Including the$795.6 millionof cash in ATMs at June 30, 2024, we have access to$2,555.2 millionin available cash, and $802.0 million available under the Credit Facility.

Previous wording

The following table identifies cash and cash equivalents provided by/(used in) our operating, investing and financing activities for thethree months ended March 31, 2024 and 2023 (in millions):

Current wording

The following table identifies cash and cash equivalents provided by/(used in) our operating, investing and financing activities for thesix months ended June 30, 2024 and 2023 (in millions):

Previous wording

Cash flows provided by operating activities were $30.0 million for thethree months ended March 31, 2024 compared to cash flows provided by operating activities of$3.3 million for the same period in 2023. The netincrease in operating cash flows was primarily due to an increase in net income, the effect of exchange rates on balance sheet positions in foreign currencies and other working capital fluctuations.

Current wording

Cash flows provided by operating activities were $212.2 million for thesix months ended June 30, 2024 compared to cash flows provided by operating activities of$220.2 million for the same period in 2023. The netdecrease in operating cash flows was primarily due toother working capital fluctuations.

Previous wording

Cash flows used in investing activities were$96.8 million for thethree months ended March 31, 2024 compared to$18.1 million for the same period in 2023. The increase in cash used in investing activities is primarily due to the $70.0 million of cash paid for the acquisition of Infinitium. Additionally, we used$23.8 million for purchases of property and equipmentfor thethree months ended March 31, 2024 compared to$18.6 million for the same period in 2023.

Current wording

Cash flows used in investing activities were$155.2 million for thesix months ended June 30, 2024 compared to$45.5 million for the same period in 2023. The increase in cash used in investing activities is primarily due to the $90.8 million of cash paid for the acquisitions during the first six months of 2024. Additionally, we used$57.2 million for purchases of property and equipmentfor thesix months ended June 30, 2024 compared to$41.9 million for the same period in 2023.