WEX Inc.

WEX INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

The accompanying condensed consolidated financial statements, which include the accounts of WEX Inc. and its subsidiaries, have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10–Q and Rule 10–01 of Regulation S–X. Accordingly, they exclude certain disclosures required by GAAP for a complete set of financial statements. Unless the context suggests otherwise, references in this Quarterly Report on Form 10-Q to “WEX,” the “Company,” “we” or “our” refer to WEX Inc. and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

In the opinion of management, all adjustments of a normal recurring nature considered necessary for a fair presentation in accordance with GAAP have been included. Operating results for the three and six months ended June 30, 2025 are not necessarily indicative of the results for any future periods or the year ending December 31, 2025. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements that are included in the Company’s Annual Report on Form 10–K for the year ended December 31, 2024, filed with the SEC on February 20, 2025 (“2024 Annual Report”).

The Company rounds amounts in the condensed consolidated financial statements to millions and calculates all percentages and per-share data from underlying whole-dollar amounts. Thus, certain amounts may not foot, crossfoot or recalculate based on reported numbers due to rounding. We have included certain terms and abbreviations used throughout this Quarterly Report on Form 10-Q within “Acronyms and Abbreviations” in the front of this document.

Significant Accounting Policies

The significant accounting policies used in preparation of these condensed consolidated financial statements as of and for the six months ended June 30, 2025, are consistent with those discussed in “Note 1, Basis of Presentation and Summary of Significant Accounting Policies” to the consolidated financial statements in our 2024 Annual Report.

Cash and Cash Equivalents and Restricted Cash

The following table provides a reconciliation of end of period cash, cash equivalents and restricted cash reported within our condensed consolidated statements of cash flows to amounts within our condensed consolidated balance sheets for the periods ended:

Recent Accounting Pronouncements

The Company evaluates all ASUs recently issued by the FASB for consideration of their applicability. Any recently issued ASUs not listed in the following table were assessed and determined to either not be applicable, or have not had, or are not expected to have, a material impact on our condensed consolidated financial statements. The Company did not adopt any accounting standards during the six months ended June 30, 2025.

In accordance with Topic 606, revenue is recognized when, or as, performance obligations are satisfied as defined by the terms of the contract, in an amount that reflects the consideration to which the Company expects to be entitled in exchange for goods or services provided. Income recognized that is not derived from a contract with a customer within the scope of Topic 606 is included within Non-Topic 606 revenues.

The following tables disaggregate the Company’s consolidated revenues, substantially all of which relate to services transferred to the customer over time:

Contract Balances

The majority of the Company’s receivables, which are excluded from the table below, are either due from cardholders who have not been deemed our customer as it relates to interchange income, or from revenues earned outside of the scope of Topic 606. The Company’s contract assets consist of upfront payments to customers under long-term contracts and are recorded upon the later of when the Company recognizes revenue for the transfer of the related goods or services or when the Company pays or promises to pay the consideration. The resulting asset is amortized against revenue as the Company satisfies its performance obligations under these arrangements. The Company’s contract liabilities consist of customer payments received before the Company has satisfied the associated performance obligations. The following table provides information about these contract balances:

During the three and six months ended June 30, 2025, the Company recognized revenue of $7.4 million and $16.3 million, respectively, related to contract liabilities existing as of December 31, 2024.

Remaining Performance Obligations

The Company’s unsatisfied or partially unsatisfied performance obligations as of June 30, 2025 represent the remaining minimum monthly fees on a portion of contracts across the lines of business, deferred revenue associated with stand ready payment processing obligations and contractually obligated professional services yet to be provided by the Company. The total remaining performance obligations below are not indicative of the Company’s future revenue, as they relate to an insignificant portion of the Company’s operations.

The following table includes revenue expected to be recognized related to remaining performance obligations at the end of the indicated reporting period.

(1)The transaction price allocated to the remaining performance obligations represents the minimum monthly fees on certain service contracts, which contain substantive termination penalties that require the counterparty to pay the Company for the aggregate remaining minimum monthly fees upon an early termination for convenience. These obligations will be recognized within account servicing revenue.

(2)Substantially represents deferred revenue and contractual minimums associated with payment processing service obligations. Consideration associated with certain relationships is variable and the measurement and estimation of contract consideration is contingent upon payment processing volumes and maintaining volume shares, among others.

Asset Acquisition

During January 2025, the Company entered into a purchase and sale agreement for the purchase of a portfolio of factoring accounts receivable from a third-party, which serves various customers in the U.S. transportation industry. During March 2025, the Company closed on the acquisition of these receivables, paying the seller a preliminary purchase price of $144.5 million, which includes a 10 percent premium relative to the net value of the receivables balance as of the valuation date, plus certain customary adjustments, as defined in the purchase and sale agreement. We accounted for this transaction under the asset acquisition method of accounting and allocated $130.0 million of the total cost of the acquisition to accounts receivable, net of allowance and $14.5 million to a customer relationship intangible asset with aten-year life. The consideration paid for the accounts receivable was included within operating activities in the consolidated statement of cash flows.

Accounts receivable consists of amounts billed to and due from customers across a wide range of industries and other third parties. The Company often extends short-term credit to cardholders by paying the merchant for the purchase price less the fees it retains and records as revenue, then subsequently collecting the total purchase price from the cardholder. The Company also extends revolving credit to certain small fleets. The Company had approximately $117.3 million and $114.1 million in gross receivables with revolving credit balances as of June 30, 2025 and December 31, 2024, respectively.

The allowance for accounts receivable consists of reserves for both credit and fraud losses, reflecting management’s current estimate of uncollectible balances on its accounts receivable. The following tables present changes in the accounts receivable allowances by portfolio segment:

(1)The provision is comprised of estimated credit losses based on the Company’s loss-rate experience and includes adjustments required for forecasted credit loss information. The provision for credit losses reported within this table also includes the provision for fraud losses.

(2)Consists primarily of charges to other accounts. The Company earns revenue by assessing monthly finance fees on accounts with overdue balances. These fees are recognized as revenue at the time the fees are assessed. The finance fee is calculated using the greater of a minimum charge or a stated late fee rate multiplied by the outstanding balance that is subject to a late fee charge. On occasion, these fees are waived to maintain relationship goodwill. Charges to other accounts substantially represent the offset against the late fee revenue recognized when the Company establishes a reserve for such waived amounts.

The following table presents the outstanding balance of trade accounts receivable that are less than 30 and 60 days past due, shown in each case as a percentage of total trade accounts receivable:

Concentration of Credit Risk

The receivables portfolio primarily consists of a large group of homogeneous balances across a wide range of industries, which are collectively evaluated for impairment. No individual customer had a receivable balance representing 10 percent or more of the outstanding receivables balance at June 30, 2025 or December 31, 2024.

Under share buyback plans, which may be authorized by our board of directors from time to time, the Company may repurchase up to specified dollar values of shares of its common stock through open market purchases, privately negotiated transactions, accelerated share repurchase programs, issuer self-tender offers or other methods approved by our board of directors.

Modified “Dutch auction” Tender Offer

On February 26, 2025, the Company commenced a modified “Dutch auction” tender offer to repurchase up to $750.0 million worth of its common stock (the “Tender Offer”). On March 31, 2025, the Company completed the Tender Offer and accepted for purchase a total of approximately 4.9 million shares of its common stock at a purchase price of $154 per share. The Company paid $750.0 million in cash to complete the Tender Offer, excluding related costs and fees. The Company incurred approximately $4.2 million of costs and fees related to the Tender Offer, which are recorded along with the cost of the shares repurchased as treasury stock on the accompanying condensed consolidated financial statements.

Summary of Share Repurchases

During the three and six months ended June 30, 2025 and 2024, pursuant to our existing previously approved and announced repurchase program, the Company repurchased the following approximate shares of common stock, inclusive of the share purchases under the Tender Offer, which have been recorded as treasury stock:

1 Reflects the applicable one percent excise tax imposed by the Inflation Reduction Act of 2022 on the net value of certain stock repurchases along with costs and fees of the Tender Offer.

Basic earnings per share is computed by dividing net income by the weighted average number of shares of common stock and vested DSUs outstanding during the year. The computation of diluted earnings per share is similar to the computation of basic earnings per share, except that diluted earnings per share includes the assumed exercise of dilutive options, the assumed issuance of unvested RSUs, performance-based awards for which the performance condition has been met as of the date of determination and contingently issuable shares that would be issuable if the end of the reporting period was the end of the contingency period, using the treasury stock method unless the effect is anti-dilutive. The treasury stock method assumes that proceeds, including cash received from the exercise of employee stock options and the average unrecognized compensation expense for unvested share-based compensation awards, would be used to purchase the Company’s common stock at the average market price during the period.

The following table presents net income and reconciles basic and diluted shares outstanding used in the earnings per share computations:

(1)For the three and six months ended June 30, 2025,0.9 million and 0.8 million, respectively, of outstanding share-based compensation awards were excluded from the computation of diluted earnings per share under the treasury stock method, as the effect of including those shares would be anti-dilutive. For the three and six months ended June 30, 20240.4 million and 0.3 million, respectively, of outstanding share-based compensation awards were excluded from the computation of diluted earnings per share under the treasury stock method, as the effect of including those shares would be anti-dilutive.

Contingent Consideration Derivative Liability

At June 30, 2025 and December 31, 2024, the Company had a contingent consideration derivative liability associated with its asset acquisition from Bell Bank. See Note 13, Financial Instruments − Fair Value and Concentrations of Credit Risk, for further discussion of this derivative and for more information regarding the valuation of the Company’s derivatives.

WEX Bank’s regulatory status enables it to raise capital to fund the Company’s working capital requirements by issuing deposits, subject to FDIC rules governing minimum financial ratios. See Note 18, Supplementary Regulatory Capital Disclosure, for further information concerning these FDIC requirements.

WEX Bank accepts its deposits through certain customers as required collateral for credit that has been extended (“customer deposits”) and contractual arrangements for brokered and non-brokered certificate of deposit and money market deposit products. Additionally, WEX Bank holds deposits for the benefit of WEX Inc.’s HSA customers subject to the terms of a deposit agreement.

Customer deposits are generally non-interest bearing, certificates of deposit are issued at fixed rates, money market deposits are issued at both fixed and variable interest rates based on the Federal Funds rate and HSA deposits are issued at rates as defined within the consumer account agreements.

The following table presents the composition of deposits, which are classified as short-term or long-term based on their contractual maturities:

(1)As of June 30, 2025 and December 31, 2024, all certificates of deposit and money market deposits were in denominations of $250,000 or less, corresponding to FDIC deposit insurance limits.

(2)Includes certificates of deposit and certain money market deposits, which have a fixed maturity.

(3)HSA deposits are recorded within short-term deposits on the condensed consolidated balance sheets as the funds can be withdrawn by the account holders at any time.

The following tables summarize the Company’s total outstanding debt as of June 30, 2025 and December 31, 2024.

**Provided for the total Credit Agreement borrowings below.

(1)Bears interest at variable rates, at the Company’s option, plus an applicable margin determined based on the Company’s consolidated leverage ratio. Outstanding borrowings under the Revolving Credit Facility are classified as long-term given they can be rolled forward with interest rate resets through maturity. Note that the maturity date of each of the Term A-1 Loans and Revolving Credit Facility is the earlier of (i) May 10, 2029 and (ii) the date that is 91 days prior to the maturity of the Term B-2 Loans, as further described in the Credit Agreement.

(2)Bears interest at variable rates, at the Company’s option, plus an applicable margin, which is fixed at 0.75 percent for base rate borrowings and 1.75 percent with respect to Term SOFR borrowings.

(3)As of June 30, 2025 and December 31, 2024, amounts outstanding under the Credit Agreement bore a weighted average effective interest rate of 6.1 percent and 6.0 percent, respectively.

(4)See Note 13, Financial Instruments − Fair Value and Concentrations of Credit Risk for information regarding the fair value of the Company’s debt.

(5)Current portion of long-term debt as of June 30, 2025 and December 31, 2024 is net of $8.7 million and $6.9 million in unamortized debt issuance costs/discounts, respectively.

(1)Primarily collateralizing Corporate Payments processing activity.

(2)Borrowing capacity is contingent on maintaining compliance with the financial covenants as defined in the Company’s Credit Agreement. As of June 30, 2025, the Company pays a quarterly commitment fee at a rate per annum ranging from 0.25 percent to 0.45 percent of the daily unused portion of the Revolving Credit Facility determined based on the Company’s consolidated leverage ratio. The quarterly commitment fee in effect as of June 30, 2025 was 0.30 percent and was 0.25 percent as of December 31, 2024.

Credit Agreement

As of December 31, 2024, under the Credit Agreement, we had senior secured tranche A term loans (the “Term A Loans”), senior secured tranche B term loans (the “Term B Loans”) and outstanding commitments under the Revolving Credit Facility.

On March 6, 2025, the Company and certain of its subsidiaries entered into the Seventh Amendment to the Credit Agreement (the “Seventh Amendment”), which, among other things, established an incremental tranche of senior secured tranche B term loans in an aggregate principal amount of $450.0 million (the “Incremental Term B-3 Loans”), which are scheduled to mature on March 6, 2032. The Incremental Term B-3 Loans were issued with 0.5 percent original issue discount (OID) and bear interest at variable rates at the Company’s option, plus an applicable margin, which is fixed at 0.75 percent for base rate borrowings and 1.75 percent with respect to Term SOFR borrowings. The Incremental Term B-3 Loans may be voluntarily prepaid, subject to a 1.00 percent prepayment premium within six months of the closing date of the Seventh Amendment. The proceeds from the Incremental Term B-3 Loans were primarily used to fund the Tender

Offer and to repay a portion of the Company’s outstanding borrowings on the Revolving Credit Facility. See Note 6, Repurchases of Common Stock, for more information on the Tender Offer.

The Company incurred debt financing costs of approximately $4.9 million in conjunction with the Seventh Amendment, in addition to the OID of $2.3 million. The OID and debt financing costs are being amortized over the term of the borrowing to financing interest expense, net of financial instruments.

Senior Notes

On March 6, 2025, the Company completed a private offering of $550.0 million in aggregate principal amount of 6.500% senior unsecured notes due March 15, 2033 (the “Senior Notes”). The Senior Notes bear interest at a rate of 6.5 percent per annum, payable semi-annually. The proceeds from the Senior Notes were primarily used to fund the Tender Offer discussed above under Credit Agreementand to repay a portion of the Company’s outstanding borrowings under the Revolving Credit Facility. Subject to the conditions set forth in the Indenture, the Senior Notes may be redeemed at the Company’s option, in whole or in part, at the following redemption prices:

The Company incurred debt financing costs of approximately $9.2 million in connection with the Senior Notes offering. The debt financing costs are being amortized over the term of the borrowing as non-cash interest expense.

Securitization Debt (VIEs)

Under securitized debt agreements, each month on a revolving basis, the Company sells certain of its Australian and European receivables to bankruptcy-remote entities that are VIEs consolidated by the Company, which in turn use the receivables as collateral to issue securitized debt. Amounts collected on the securitized receivables, including an immaterial amount of cash and cash equivalents as of June 30, 2025 and December 31, 2024, are restricted to pay the securitized debt and are not available for general corporate purposes. Additionally, creditors of the VIE do not have recourse to WEX Inc. The Company pays interest on the outstanding balance of the securitized debt based on variable interest rates plus an applicable margin.

The Company’s securitized debt agreement for the securitization of its European receivables is with MUFG Bank, Ltd., has a maximum revolving borrowing limit of €55.0 million and expires in April 2026, unless otherwise agreed to in writing by the parties. The Company’s securitized debt facility for the securitization of its Australian receivables is with Australia and New Zealand Banking Group Limited, has a maximum revolving borrowing limit of A$115.0 million, expires in October 2025 and is annually renewable thereafter unless earlier terminated.

Participation Debt

From time to time, WEX Bank enters into participation agreements with third-party banks to fund customers’ balances that exceed WEX Bank’s lending limit to individual customers. Associated unsecured borrowings generally carry a variable interest rate set according to an applicable reference rate plus a margin, which was 2.25 percent as of June 30, 2025 and December 31, 2024. As of June 30, 2025, the Company has an outstanding participation agreement that allows for total borrowings of up to $70.0 million and expires in December 2025, unless otherwise agreed to in writing by the parties. Borrowings under the participation agreement are included in short-term debt given they may be canceled by either party upon 60 days’ advance written notice.

FHLB Advances

WEX Bank is a member of the Federal Home Loan Bank (FHLB) of Des Moines, which provides WEX Bank short-term funding collateralized by investment securities. WEX Bank had $1.1 billion of collateralized borrowings outstanding with the

FHLB as of June 30, 2025, with a remaining borrowing capacity of $121.9 million based on collateral provided as of that date.

Borrowed Federal Funds

WEX Bank borrows from short-term uncommitted federal funds lines of credit extended by various financial institutions to supplement the financing of the Company’s accounts receivable. Under these federal funds lines of credit as of June 30, 2025, WEX Bank had $170.0 million in outstanding borrowings, while as of December 31, 2024, WEX hadno outstanding borrowings against these lines of credit.

Other Short Term Borrowings

As an additional source of liquidity, WEX Bank pledged $199.3 million as of June 30, 2025 of customer receivables held by WEX Bank to the Federal Reserve Bank as collateral for potential borrowings through the Federal Reserve Bank Discount Window. Amounts that can be borrowed are based on the amount of collateral pledged and were $146.6 million and $137.7 million as of June 30, 2025 and December 31, 2024, respectively. WEX Bank hadno borrowings outstanding on this line of credit through the Federal Reserve Bank Discount Window as of June 30, 2025 and December 31, 2024.

Under an uncommitted borrowing facility, WEX Australia can be advanced up to A$21.3 million from Bank of America in short-term funds. Interest accrues on any advances at a rate fixed for each interest period of 1.80 percent above the Australian Bank Bill Buying Rate for that interest period. The Company hadno borrowings outstanding on this facility as of June 30, 2025 and December 31, 2024.

WEX Europe Services and WEX Bank Accounts Receivable Factoring

WEX Europe Services and WEX Bank are each party to separate accounts receivable factoring arrangements with unrelated third-party financial institutions to sell certain of their accounts receivable balances. Each subsidiary continues to service these receivables post-transfer with no participating interest. Upon transfer, proceeds received are recorded net of applicable costs or negotiated discount rates and are recorded in operating activities in the condensed consolidated statements of cash flows. Cost of factoring, which was $2.3 million and $4.2 million, for the three and six months ended June 30, 2025, respectively, and $3.3 million and $6.5 million for the three and six months ended June 30, 2024, respectively, is recorded within cost of services in the condensed consolidated statements of operations.

The WEX Europe Services agreement automatically renews each January 1 unless either party gives not less than 90 days written notice of their intention to withdraw. Under this agreement, accounts receivable are sold without recourse to the extent that the customer balances are maintained at or below the credit limit established by the buyer. The Company maintains the risk of default on any customer receivable balances in excess of the buyer’s credit limit, which were immaterial as of June 30, 2025 and December 31, 2024. Under this arrangement, the Company sold $120.5 million and $232.8 million of accounts receivable during the three and six months ended June 30, 2025, respectively, and $137.1 million and $267.7 million of accounts receivable during the three and six months ended June 30, 2024, respectively.

The WEX Bank agreement has no set expiration date, however, either party can terminate the agreement with 30 days’ notice. Under this arrangement, the Company sold $3.6 billion and $5.9 billion of trade accounts receivable during the three and six months ended June 30, 2025, respectively, and $5.3 billion and $9.8 billion during the three and six months ended June 30, 2024, respectively.

Non-Bank Custodial HSA Cash Assets

As a non-bank custodian, WEX Inc. contracts with depository partners to hold custodial cash assets on behalf of individual account holders. As of June 30, 2025, WEX Inc. was custodian to approximately $4.7 billion in HSA cash assets. Of these custodial balances, approximately $0.8 billion of HSA cash assets at June 30, 2025 were deposited with and managed by certain third-party partners and not recorded on our condensed consolidated balance sheets. Such third-party depository

partners are regularly monitored by management for stability. The remaining balance of $4.0 billion in HSA cash assets as of June 30, 2025 is deposited with and managed by WEX Bank and is therefore reflected on our condensed consolidated balance sheets. See Note 9, Deposits, for further information about HSA deposits recorded on our condensed consolidated balance sheets.

The Company’s investment securities as of June 30, 2025 and December 31, 2024 are presented below. Accrued interest on investment securities of $34.0 million and $30.9 million, respectively, as of June 30, 2025 and December 31, 2024, is excluded from total investment securities and recorded within prepaid expenses and other current assets on the condensed consolidated balance sheets.

(1)The Company’s methods for measuring the fair value of its investment securities are discussed in Note 13, Financial Instruments − Fair Value and Concentrations of Credit Risk.

(2)As of June 30, 2025, the Company has pledged available-for-sale debt securities with a fair value of $85.8 million as collateral against recurring settlement obligations owed in conjunction with its transactions processed through licensed card networks and $1.4 billion as collateral for FHLB advances, as further discussed in Note 10, Financing and Other Debt.

(3)The fair value of available-for-sale debt securities at June 30, 2025 was comprised of municipal bonds of $31.8 million and mortgage-backed securities of $9.4 million. The fair value of available-for-sale debt securities at December 31, 2024 was comprised of municipal bonds of $31.9 million and mortgage-backed securities of $9.8 million.

(4)Excludes $17.6 million and $16.4 million in equity securities as of June 30, 2025 and December 31, 2024, respectively, included in prepaid expenses and other current assets and other assets on the condensed consolidated balance sheets.

The following table presents estimated fair value and gross unrealized losses of available-for-sale debt securities in an unrealized loss position for which an allowance for credit losses has not been recorded, aggregated by security category. There are no expected credit losses that have been recorded against our investment securities as of June 30, 2025 and December 31, 2024.

The above table includes 458 investment positions at June 30, 2025, where the current fair value is less than the related amortized cost. Unrealized losses on the Company’s available-for-sale debt securities included in the above table are primarily driven by the elevated interest rate environment and are not considered to be credit-related based upon an analysis that considered the extent to which the fair value is less than the amortized basis of a security, adverse conditions specifically related to the security, changes to credit rating of the instrument subsequent to Company purchase, and the strength of the underlying collateral, if any. Additionally, the Company does not intend to sell the securities and it is not more likely than not that the Company will be required to sell the securities before recovery of their amortized cost bases.

The following table summarizes the contractual maturity dates of the Company’s available-for-sale debt securities.

Equity Securities

During the three and six months ended June 30, 2025 and 2024, unrealized gains and losses recognized on equity securities still held as of those dates were immaterial.

Other Investments

The Company’s other investments at June 30, 2025 and December 31, 2024, which include Federal Home Loan Bank stock and minority equity or other investments in early-stage companies and venture capital funds for which there is no readily determinable fair value, were $77.8 million and $65.1 million, respectively. The investments are recorded at cost within other assets on our condensed consolidated balance sheets.

Financial Instruments Measured at Fair Value on a Recurring Basis

The following table presents the Company’s financial instruments that are measured at fair value on a recurring basis, as classified within the three-level fair value hierarchy:

(1)The fair value is recorded in cash and cash equivalents.

(2)The fair value of this security is measured at NAV as a practical expedient and has not been classified within the fair value hierarchy. The amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the condensed consolidated balance sheets.

(3)The fair value is recorded as current or long-term based on the timing of the Company’s executive deferred compensation plan payment obligations. At June 30, 2025, $1.7 million and $15.9 million in fair value is recorded within prepaid expenses and other current assets and other assets, respectively. At December 31, 2024, $1.8 million and $14.7 million in fair value is recorded within prepaid expenses and other current assets and other assets, respectively.

(4)The fair value is recorded as current or long-term based on the timing of expected payments. At June 30, 2025, $49.7 million and $17.9 million in fair value is recorded within accrued expenses and other current liabilities and other liabilities, respectively. At December 31, 2024, $62.2 million and $66.0 million in fair value is recorded within accrued expenses and other current liabilities and other liabilities, respectively.

Money Market Mutual Funds

A portion of the Company’s cash and cash equivalents are invested in money market mutual funds that primarily consist of short-term government securities, which are classified as Level 1 in the fair value hierarchy because they are valued using quoted market prices for identical instruments in an active market.

Available-for-Sale Debt Securities

The Company determines the fair value of U.S. treasury notes using quoted market prices for similar or identical instruments in a market that is not active. For corporate and sovereign debt securities, municipal bonds, and asset-backed and mortgage-backed securities, the Company generally uses quoted prices for recent trading activity of assets with similar characteristics to the debt security or bond being valued. The securities and bonds priced using such methods are generally valued using Level 2 inputs to the fair value hierarchy.

Pooled Investment Fund

The pooled investment fund maintains individual capital accounts for each investor, which reflect each individual investor’s share of the NAV of the fund. As of June 30, 2025, the Company hadno unfunded commitments with respect to the fund. Investments in the fund may be redeemed monthly with 30 days’ notice.

Mutual Fund

The Company determines the fair value of its mutual fund using quoted market prices for identical instruments in an active market; such inputs are classified as Level 1 of the fair value hierarchy.

Executive Deferred Compensation Plan Trust

The investments held in the executive deferred compensation plan trust, which consist primarily of mutual funds, are classified as Level 1 in the fair value hierarchy because the fair value is determined using quoted market prices for identical instruments in active markets.

Contingent Consideration

The Company is obligated to pay additional consideration to Bell Bank as part of a prior year asset acquisition, contingent upon increases in the Federal Funds rate from the date of acquisition. The Company determines the fair value of this contingent consideration derivative liability based on discounted cash flows using the difference between the baseline Federal Funds rate in the purchase agreement with Bell Bank and future forecasted Federal Funds rates over the agreement term. The Company records changes in the estimated fair value of the contingent consideration in the condensed consolidated statements of operations.

Due to significant increases in the Federal Funds rate since the acquisition date, the fair value of the Company’s contingent consideration derivative liability at both June 30, 2025 and December 31, 2024 were effectively measured at the present value of the maximum remaining contingent consideration payable under the arrangement. Accordingly, the fair value of the contingent consideration could not materially increase, however, a significant decrease in the Federal Funds rate could result in a material decrease in the derivative liability.

Financial Instruments Measured at Carrying Value, for which Fair Value is Disclosed

The fair value of the Company’s financial instruments, which are measured and reported at carrying value, is as follows for the periods indicated:

**Fair value approximates carrying value.

(1)The Company determines the fair value of borrowings on the Revolving Credit Facility, Term Loans and Senior Notes based on market rates for the issuance of the Company’s debt, which are Level 2 inputs in the fair value hierarchy.

Other Assets and Liabilities

The carrying value of certain of the Company’s financial instruments, other than those presented above, including cash, cash equivalents, restricted cash and restricted cash payable, short-term contractual deposits and HSA deposits, accounts receivable and securitized accounts receivable, accounts payable, accrued expenses and other current liabilities and other liabilities, approximate their respective fair values due to their short-term nature or maturities. The carrying value of certain other financial instruments, including interest-bearing money market deposits, securitized debt, participation debt, borrowed federal funds and deferred consideration associated with our acquisitions approximate their respective fair values due to stated interest rates being consistent with current market interest rates.

Concentrations of Credit Risk

The Company’s financial instruments that are exposed to concentrations of credit risk consist principally of cash and cash equivalents, restricted cash, investment securities and trade receivables. Concentration of credit risk with respect to accounts receivable is limited because a large number of geographically and industry diverse customers make up our customer base. See Note 5, Accounts Receivable, Net, for further information.

The Company’s cash and cash equivalents and restricted cash are transacted and maintained with financial institutions with high credit standing. Cash balances at many of these institutions regularly exceed FDIC insured limits; however, management regularly monitors the financial institutions and the composition of the Company’s accounts. We have not experienced any losses in such accounts and management believes that the financial institutions at which the Company’s cash is held are stable. We attempt to limit our exposure to credit risk with our investment securities by establishing strict investment policies as to minimum investment ratings, diversification of our portfolio and setting risk tolerance levels.

The Company’s effective tax rate was 27.0 percent and 27.9 percent for the three and six months ended June 30, 2025, respectively, and 27.5 percent and 27.2 percent for the three and six months ended June 30, 2024, respectively. Income tax expense is based on an estimated annual effective rate, which requires the Company to make its best estimate of annual pretax income or loss. The Company’s effective income tax rates for the three and six months ended June 30, 2025 and 2024 differ from the U.S. federal statutory rate primarily due to the jurisdictional earnings mix and permanent book to tax differences arising from stock-based compensation. In addition, the effective income tax rate for the six months ended June 30, 2024 was impacted by a discrete tax item primarily associated with an uncertain tax position related to state income taxes.

Undistributed earnings of certain foreign subsidiaries of the Company amounted to $352.0 million and $313.6 million at June 30, 2025 and December 31, 2024, respectively. The Company continues to maintain its indefinite reinvestment assertion for its investments in foreign subsidiaries except for any historical undistributed earnings and future earnings for WEX Australia. Upon distribution of these earnings, the Company would be subject to withholding taxes payable to foreign countries, where applicable, but would generally have no further federal income tax liability. It is not practicable to estimate the unrecognized deferred tax liability associated with these undistributed earnings; however, it is not expected to be material.

On December 12, 2022, the European Union (EU) Member States formally adopted the EU’s Pillar Two Directive, which generally provides for a minimum effective tax rate of 15 percent, as established by the Organization for Economic Co-operation and Development (“OECD”) Pillar Two Framework that was supported by over 130 countries worldwide. The EU effective dates were January 1, 2024, and January 1, 2025, for different aspects of the directive. The impact of the Pillar Two Framework on the Company’s income tax provision for the three and six months ended June 30, 2025 and 2024 wasnot material. The Company is continuing to evaluate the potential impact of the Pillar Two Framework on future periods, pending legislative adoption by additional individual countries.

On July 4, 2025, President Trump signed into law a budget and reconciliation package known as the “One Big Beautiful Bill Act” (OBBBA), which makes certain tax provisions from the 2017 Tax Cuts and Jobs Act (TCJA) permanent, introduces new tax provisions with varying effective dates, and rolls back certain incentives from the 2022 Inflation Reduction Act. One of the key features impacting the Company from the OBBBA includes domestic research cost expensing in tax years beginning after December 31, 2024. As a result, the Company expects a decrease in cash paid for U.S. federal income taxes in the current year relative to prior years. The Company is still evaluating the impact the provisions within the OBBBA could have on our financial position, results of operations and cash flows. All impacts from the OBBBA will be reflected in future reporting periods.

Litigation and Regulatory Matters

From time to time, the Company is subject to legal proceedings, claims and regulatory matters in the ordinary course of business, including but not limited to: commercial disputes; contract disputes; employment litigation; disputes regarding our intellectual property rights; alleged infringement or misappropriation by us of intellectual property rights of others, and, matters relating to our compliance with applicable laws and regulations. As of the date of this filing, the current estimate of a reasonably possible loss contingency from all legal or regulatory proceedings is not material to the Company’s consolidated financial position, results of operations, cash flows or liquidity.

Commitments

Significant commitments and contingencies as of June 30, 2025 are generally consistent with those discussed in Note 20, Commitments and Contingencies, to the consolidated financial statements in the Company’s Annual Report on Form 10–K for the year ended December 31, 2024.

On May 15, 2025 our stockholders approved an amendment to the Company’s Amended and Restated 2019 Equity and Incentive Plan (as amended, the “A&R 2019 Plan”), which had previously been adopted by the Company’s Board of Directors subject to stockholder approval. The A&R 2019 Plan amends the Company’s Amended and Restated 2019 Equity and Incentive Plan to increase the number of shares of the Company’s common stock available for issuance under the A&R 2019 Plan by approximately 3.4 million shares to 4.0 million shares, subject to the provisions in the A&R 2019 Plan.

The Company has regularly granted equity awards to certain employees and directors in the form of stock options, restricted stock, restricted stock units and other stock-based awards. In addition, the A&R 2019 Plan allows the Company to grant shares of WEX common stock to employees in lieu of bonus or other compensation earned by such employees.

In lieu of cash compensation payable to certain employees under our 2025 short-term incentive plan (“STIP”), the Company expects to award shares of WEX stock in an amount equal to the total STIP compensation payable to each respective employee, divided by the closing price of WEX common stock on the date of settlement. These awards are treated as liability-classified equity awards and the expense associated with them is accrued over the one-year performance period and included within stock-based compensation expense below.

Stock-based compensation expense was $31.7 million and $44.3 millionfor the three and six months ended June 30, 2025, respectively, and $33.4 million and $61.5 million for the three and six months ended June 30, 2024, respectively.

The Company determines its operating segments and reports segment information in accordance with how our Chief Executive Officer, the Company’s CODM, allocates resources and assesses performance. The Company has both three operating segments andthree reportable segments, as described below.

•Mobility provides payment solutions, transaction processing, and information management services to a diverse customer base globally. Beyond fuel cards, our portfolio includes SaaS solutions for field service management, telematics, reporting and analytics, cash flow management, and mixed-energy fleets.

•Corporate Payments delivers global B2B payment solutions, including our Direct to Corporate solution that integrates with ERPs and accounting workflows to maximize virtual payment usage, and our Embedded Payments solution that integrates virtual payment capabilities into existing workflows for a broad range of industries, including online travel. We also offer white-label partnerships with financial institutions.

•Benefits simplifies employee benefit plan administration through SaaS software integrated with payment solutions. We deliver diverse product offerings including benefit administration, HSAs, FSAs, HRAs, COBRA and direct billing, and compliance administration. WEX Inc. also serves as an IRS-designated non-bank custodian, while WEX Bank provides HSA depository services.

The CODM uses segment adjusted operating income to evaluate the financial performance of each segment and make decisions regarding the allocation of capital and resources to each segment. The CODM also uses variance analysis of segment adjusted operating income on a recurring basis to assess the performance of the segment against forecast, prior periods and the annual budget. We do not allocate assets to our operating segments as we do not use assets to assess our segment performance.

Segment revenues, expenses and adjusted operating income

Segment adjusted operating income, as reported in the following tables, excludes unallocated corporate expenses, acquisition-related intangible amortization, other acquisition and divestiture related items, debt restructuring costs, stock-based compensation, other costs and certain non-recurring or non-cash operating charges that are not core to our operations, as applicable depending on the period presented. Accordingly, certain significant expenses included below have been marked as “adjusted”, as they do not agree with similarly named expense totals appearing elsewhere within this quarterly report on Form 10-Q, due to these exclusions.

• Not deemed a significant expense category for these reportable segments.

(1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.

(2)Other segment items for the Mobility reportable segment includes depreciation expense for each of the periods presented. Other segment items for the Corporate Payments and Benefits reportable segments includes depreciation expense, operating interest expense and provision for credit losses for each of the periods presented.

(3)See following table for a reconciliation of segment adjusted operating income to income before income taxes.

Segment adjusted operating income reconciliation

The following table reconciles total segment adjusted operating income to income before income taxes:

Other segment disclosures

(1)The amounts of interest income disclosed by reportable segment are included within total revenues in the preceding tables.

(2)The amounts of depreciation disclosed by reportable segment are included within other segment items. Amounts do not include amortization of intangible assets, as amortization is not included in determining segment adjusted operating income.

The Company’s subsidiary, WEX Bank, is subject to various regulatory capital requirements administered by the FDIC and the UDFI. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, WEX Bank must meet specific capital guidelines that involve quantitative measures of WEX Bank’s assets, liabilities and certain off-balance sheet items. WEX Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. Failure to meet minimum capital requirements can initiate certain mandatory and possible additional discretionary actions by regulators that, if undertaken, could limit business activities and have a material effect on the Company’s business, results of operations and financial condition.

Quantitative measures established by regulation to ensure capital adequacy require WEX Bank to maintain minimum amounts and ratios as defined in the regulations. The most recent FDIC exam report categorized WEX Bank as “well capitalized” under the regulatory framework for prompt corrective action. There are no conditions or events subsequent to that examination report that management believes have changed WEX Bank’s capital rating.

The following table presents WEX Bank’s actual and regulatory minimum capital amounts and ratios: