Payoneer Global Inc. (PAYO)

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Throughout this section, unless otherwise noted, “we”, “us”, “our”, “Payoneer”, and the “Company” refer to Payoneer Global Inc.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q. Some of the information contained in this discussion and analysis, including information with respect to our future performance, liquidity and capital resources, and general and administrative functions, includes forward-looking statements that involve risks and uncertainties. You should review the sections titled “Cautionary Statement on Forward-Looking Statements” and “Risk Factors” for a discussion of forward-looking statements and important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Overview

Payoneer is a financial technology company purpose-built to enable the world’s small and medium-sized businesses (“SMB(s)”) to grow and operate their businesses around the world by reliably and securely connecting them to the global digital economy. Payoneer was founded in 2005 and in the 20+ years since the Company’s founding, we have built a global financial stack that makes it easier for millions of SMBs and entrepreneurs, particularly in emerging markets, to access global demand and supply, pay and get paid, and manage their cross border and other financial operations needs from a single platform. Payoneer’s core value proposition is that we remove the complexity and barriers of doing business across borders for our customers. With a multi-currency Payoneer Account, businesses around the world can serve and transact with their global customers, suppliers, vendors, and partners as if they were local.

The Payoneer financial stack is comprised of a secure, regulated payment infrastructure platform that provides customers with a one stop, global, multi-currency account to serve their comprehensive cross-border accounts receivable (“AR”) and accounts payable (“AP”) needs, including multicurrency account capabilities and services such as funds management, expense management, workforce management, and working capital. Payoneer’s global platform is built with a focus on security, stability and redundancy. The Company leverages close to 100 banking and payment service providers globally to support transactions in over 7,000 trade corridors and enable same-day and real-time settlement in over 150 countries.

Payoneer serves SMBs located in more than 190 countries and territories and operating in a wide variety of industries, and we have nearly 2 million active customers. Customers include goods exporters selling cross-border to consumers and other businesses, services companies exporting their capabilities to international clients, independent professionals, creators, contractors, and business owners capitalizing on the digitization of the workplace and remote work, vacation rental hosts, and businesses working with suppliers and vendors in different countries. Payoneer’s customers sell their goods or services either via marketplaces or directly to other businesses (B2B), and/or to customers via webstores.

Payoneer has built a meaningful brand and efficient go-to-market engine that enables us to drive customer acquisition and growth through a diverse range of channels. We leverage our global partnerships and enterprise relationships, deep local knowledge and sales presence, product- and customer-driven network effects, and organic traffic to our onboarding channels.

Our customers have trusted the Payoneer platform to process $23.7 billion and $20.7 billion in volume during the three months ended June 30, 2026 and 2025, respectively, and $46.4 billion and $40.4 billion in volume during the six months ended June 30, 2026 and 2025, respectively.

Looking forward, we intend to continue to invest actively to enhance our global platform, deliver new products, extend our regulatory footprint, further automate our operations and increase new customer growth to deliver more value to customers around the world.

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Key Developments and Trends

Proposed Acquisition by Nuvei

On June 12, 2026, the Company entered into an Agreement and Plan of Merger with Neon Maple Parent Inc., a corporation incorporated under the laws of Canada, and Panda Acquisition Sub Inc., a Delaware corporation and wholly owned indirect subsidiary of Nuvei, pursuant to which the Company will become a wholly owned subsidiary of Nuvei if the Merger is consummated. If the Merger is consummated, each share of Company Common Stock, subject to certain limitations, will be converted into the right to receive $7.40 in cash, without interest.

The proposed Merger represents a significant pending corporate transaction and remains subject to certain customary closing conditions, including approval by our stockholders, required regulatory approvals and government approvals, and other conditions set forth in the Merger Agreement. As a result, there can be no assurance that the Merger will be completed on the expected timeline or at all.

During the period until the transaction is completed or terminated, we expect to incur transaction-related costs and devote management attention and resources related to the proposed Merger. The proposed Merger may also affect our operating plans, capital allocation decisions, and liquidity depending on the timing of the outcome of the transaction. In addition, due to certain restrictions in the Merger Agreement on the conduct of our business prior to completing the Merger, we may be unable (without Nuvei’s prior written consent), during the pendency of the Merger, to pursue strategic transactions, undertake significant capital projects, undertake certain significant financing transactions and otherwise pursue other actions. For additional information regarding the Merger Agreement and related risks, see our Current Report on Form 8-K filed on June 15, 2026, Note 1, General Overview and Part II Item 1A, “Risk Factors” contained in this Quarterly Report on Form 10-Q.

Macroeconomic Conditions

We are focused on executing our strategy for growth and capturing the long-term opportunity of serving cross-border SMBs from around the world. However, macroeconomic conditions, including geopolitical and other global events that impact consumer and business spending and behavior, such as, but not limited to, the interest rate environment, inflation, evolving changes in global trade policies (including the imposition of tariffs), local political instability, global health crises, supply chain dislocations, regional and other conflicts, including the ongoing war in Ukraine, the U.S. and Israel’s war with Iran, Israel’s other conflicts in the Middle East and the volatility in the region, and disruptions and instability and regulatory changes in the banking sector may impact our customers, providers, banking partners and relationships and ultimately the amount of volume processed on our platform which may affect our results of operations. For example, the imposition of significant trade policy measures and tariffs by the U.S. government, including but not limited to tariffs on China, has introduced increased uncertainty and potential risks and opportunities for both our customers and our business. The long-term effects of these and any future trade actions on the global economy and our business remain uncertain. These developments could have a material adverse impact on our financial results in any given reporting period. We continue to monitor evolving trade policies and will evaluate potential impacts on our financial statements as more information becomes available.

Although the timing, magnitude and changes in interest rates remains uncertain, a decline in interest rates would negatively impact our interest income. In response, to reduce our sensitivity to declines in short term interest rates we have invested $1.8 billion of our customer funds in both available-for-sale debt securities and term deposits to reduce our sensitivity to declines in short term interest rates, and have purchased interest rate derivative contracts with respect to $2.2 billion in customer funds to provide a floor against the impact of interest rate declines below levels defined in the relevant interest rate derivative instruments.

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Impact of Conflicts in the Middle East

In October 2025, a ceasefire between Israel and Hamas entered into effect, to end a two-year long war between them that started on October 7, 2023. Conflicts between Israel and Hezbollah, Iran and other proxies of the Iranian regime, however, continued into 2026, including the U.S. and Israel’s war with Iran that broke out in February 2026. During the ongoing conflicts in the region, we continued to operate our business and serve our customers around the world and, to date, our ability to support customers has not been materially impacted. We continue to monitor the situation closely and benefit from our broad geographic footprint, partially outsourced operations model, and a robust business continuity plan. Additionally, our technology infrastructure has redundancy in place outside of Israel. Approximately 47% of our global employee base is located in Israel, including approximately 74% of our research and development resources, as of June 30, 2026. As of June 30, 2026, an insignificant portion of our Israeli workforce were called to military reserve duty and we have contingencies in place to cover impacted roles and responsibilities.

Our revenue derived from customers based in Israel was insignificant for both the three and six months ended June 30, 2026 and 2025, respectively, and is included within revenues from Europe, Middle East, and Africa within Note 15 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.

The volatility in the region remains high, and the state of the conflict continues to evolve, which could continue to adversely affect economic conditions in Israel and in the broader region, and could impact revenues from customers located in Israel and the region. At this time, it is difficult to assess the full impact that the ongoing regional conflicts may have on our future results of operations. Any escalation, expansion, or a prolonged continuation of the conflicts, including a prolonged period of disruption in global oil supply, has the potential to impact our operations as well as negatively impact the broader global economy, including the e-commerce sector, and may have a material adverse effect on the results of our operations.

Impact of the war in Ukraine

The ongoing war between Ukraine and Russia, resulted in economic sanctions on Russia, Belarus, and certain territories in Ukraine. We provide services to customers in Ukraine and in jurisdictions that are or may be impacted by these economic sanctions. We do not provide services to customers in Russia, and we have limited our payment services to Belarus customers. We maintain a robust transaction monitoring program designed to comply with imposed sanctions and to monitor the impact the conflict may have on our results of operations. Our revenues in Ukraine have remained relatively stable as a percentage of our business. For the three and six months ended June 30, 2026, Ukraine and Belarus, combined, accounted for less than 10% of our revenue, of which Belarus accounted for less than 1% of our revenue. Further escalation of the conflict may have a material effect on our results of operations.

Recent Acquisitions

On January

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Throughout this section, unless otherwise noted, “we”, “us”, “our”, “Payoneer”, and the “Company” refer to Payoneer Global Inc.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with other sections of this Annual Report, including “Item 1. Business,” and the accompanying Consolidated Financial Statements and related Notes included elsewhere in this Report. Some of the information contained in this discussion and analysis, including information with respect to our future performance, liquidity and capital resources, and general and administrative functions, includes forward-looking statements that involve risks and uncertainties. You should review the sections titled “Cautionary Statement Regarding Forward-Looking Statements” and “Risk Factors” for a discussion of forward-looking statements and important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

This Management’s Discussion and Analysis of Financial Condition and Results of Operations focuses on a discussion of 2025 results as compared to 2024 results. For a discussion of the 2024 results as compared to 2023 results, refer to Part I, Item 7 of our Form 10-K filed with the SEC on February 27, 2025.

Overview

Payoneer is a financial technology company purpose-built to enable the world’s small and medium-sized businesses (“SMB(s)”) to grow and operate their businesses around the world by reliably and securely connecting them to the global digital economy. Payoneer’s financial stack makes it easier for millions of SMBs and entrepreneurs, particularly in emerging markets, to access global demand and supply, pay and get paid, and manage their cross border and other needs from a single platform. Our financial stack provides a suite of cross-border accounts receivable (AR) and accounts payable (AP) capabilities, including multi-currency account capabilities, workforce management capabilities and services such as working capital solutions and funds management. Payoneer’s core value proposition is that we remove the complexity and barriers of doing business across borders for our customers. With a multi-currency Payoneer Account, businesses and entrepreneurs around the world can serve and transact with their overseas customers, suppliers, vendors, and contractors, and partners as if they were local.

We primarily generate revenues when Payoneer customers use the funds in their Payoneer account to make a payment, make a purchase or to withdraw funds to a financial institution. For our customers transacting on a B2B or DTC basis, we also in certain circumstances generate revenue when they receive funds, such as when they invoice a customer or collect payments via their webstore. Additionally, given the significant customer funds held on our platform and ongoing growth in those balances, and in light of the interest rate environment in the U.S. and elsewhere, interest earned on customer funds held on our platform has been a significant source of revenue. Our long-term strategy is centered on growing the number of customers on our platform who fit our target economic and risk profile, and on increasing the revenue we earn from each customer. We believe that successful execution of this strategy will drive revenue growth as (i) adding new customers who meet our target profile, improving retention, and increasing our product offerings to capture more wallet share will drive greater ad valorem volume of transactions processed through the Payoneer platform; and (ii) introducing new products and services and increasing customer adoption of additional products and services will improve our monetization of customers over time. Volume is one of the primary drivers for our revenue growth. See “Key Metrics and Non-GAAP Financial Measures” for additional information.

Our customers have trusted the Payoneer platform to process $87.5 billion, $80.1 billion, and $66.0 billion in volume during the years ended December 31, 2025, 2024 and 2023, respectively.

Looking forward, we intend to continue to invest actively to enhance our global platform, deliver new products, extend our regulatory footprint, further automate our operations, increase new customer growth and make acquisitions to accelerate our ability to deliver more value to customers around the world.

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Key Development and Trends

Impact of Israel’s Conflicts in the Middle East

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

Our revenue derived from customers based in Israel have been immaterial and is included within revenues from Europe, Middle East, and Africa within Note 19 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

Despite the recent ceasefire, the volatility in the region is high, and the state of the conflict remains highly uncertain and could reignite, worsen or expand which could, in turn, further impact economic conditions in Israel and in the broader region. At this time, it is difficult to assess the impact a continuation of the regional conflicts may have on our future results of operations. Any escalation, expansion, or prolonged continuation of the conflicts has the potential to impact our operations as well as negatively impact the broader global economy and may have a material adverse effect on the results of our operations.

Impact of the War in Ukraine

The ongoing war between Ukraine and Russia resulted in economic sanctions on Russia, Belarus, and certain territories in Ukraine. We provide services to customers in Ukraine and in jurisdictions that are or may be impacted by these economic sanctions. We do not provide services to customers in Russia, and we have limited our payment services to Belarus customers. We maintain a robust transaction monitoring program designed to comply with imposed sanctions. Our revenues in Ukraine have remained relatively stable as a percentage of our business. For the years ended December 31, 2025, 2024 and 2023 Ukraine and Belarus, combined, accounted for less than 10% of our revenue, of which Belarus accounted for less than 1% of our revenue. Further escalation of the conflict may have a material effect on our results of operations.

Macroeconomic Conditions

Macroeconomic conditions, such as geopolitical and other global events that impact consumer and business spending and behavior, such as, but not limited to, the interest rate environment, inflation, evolving changes to trade policies (including tariffs), particularly in the U.S, local political instability, global health crises, supply chain dislocations, regional and other conflicts, including the ongoing war in Ukraine and Israel’s conflicts in the Middle East, and the volatility in the region, and instability and regulatory changes in the banking sector, may continue to impact our customers, providers, banking partners and relationships and ultimately the amount of volume processed on our platform which may affect our results of operations.

Although the timing and magnitude in interest rates remains uncertain, given recent interest rate cuts by the U.S. Federal Reserve, we can expect and the market generally anticipates that interest rates will continue to decline over the medium term, which will negatively impact our interest income. In response, to reduce our sensitivity to declines in short term interest rates we have invested a total of $1.8 billion of our customer funds in both available-for-sale debt securities and term deposits as of the year ended December 31, 2025, and we have purchased interest rate derivative contracts with respect to $2.2 billion in customer funds to provide a floor against the impact of interest rate declines below levels defined in the relevant interest rate derivative instruments.

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Mergers & Acquisitions

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

On April 9, 2025, Payoneer acquired 100% of the outstanding equity of PayEco the parent company of EasyLink Payment Co. Ltd. (now Payoneer Payments (Guangdong) Co., Ltd), a licensed China based service provider. The acquisition strengthens Payoneer’s global regulatory infrastructure and positions it to better serve China-based customers with enhanced and localized products and services.

On August 5, 2024, Payoneer acquired 100% of the outstanding equity of Skuad Pte. Ltd. (or “Skuad”), a global workforce and payroll management company. The acquisition accelerates Payoneer’s strategy to deliver a comprehensive and integrated financial stack for SMBs that operate internationally.

Refer to Note 3 to our condensed consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further information on these acquisitions.

Seasonality

Given the diverse nature of our customers and their businesses, Payoneer’s revenues experience seasonal fluctuations as a result of consumer and business spending patterns. Historically, we have seen revenues increase in the fourth quarter of every year, primarily as a result of higher e-commerce sales during the holiday season.

Key Factors Affecting Our Performance

Continued Growth of Digital Commerce. We have continued to see growth in digital commerce, as businesses of all sizes increasingly look to access the global digital economy and as the market for goods, labor, and services becomes more global and more distributed. In 2025 we have seen slower growth in e-commerce relative to 2024, due to more volatile macro-economic and trade conditions, softer consumer spending and weaker consumer sentiment. For the years ended December 31, 2025, 2024 and 2023, total volume increased by 9%, 21% and 11% on a year-over-year basis, respectively.

Multiple Acquisition Channels Allow Us to Add Customers, Including Those That Meet Our Target Profile. We operate a two-sided network, providing services to buyers and suppliers, businesses and contractors, marketplaces and marketplace sellers, and connecting them via a single platform.

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We benefit from a strong brand in the markets in which our customers operate, and especially in key markets such as China. We continue to make investments both in our brand and in our go-to-market infrastructure, including in our local go-to-market teams. Our financial performance will depend in large part on our ability to continue to add customers, including customers who meet our target economic and risk profiles

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