What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-08-02 compared with 2023-05-09 · 193 added, 139 removed, 299 unchanged (53% of the section changed)

23 unchanged sentences

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 pandemic;

the war in the Ukraine and related economic sanctions;

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COMPANY OVERVIEW, GEOGRAPHIC LOCATIONS AND PRINCIPAL PRODUCTS AND SERVICES

Euronet is a leading electronic payments provider.

Euronet is a leading global financial technology solutions and payments provider.

We offer payment and transaction processing and distribution solutions to financial institutions, retailers, service providers and individual consumers.

Our primary product offerings include comprehensive ATM, POS, card outsourcing, card issuing and merchant acquiring services, software solutions, electronic distribution of prepaid mobile airtime, managed services and other electronic payment products, foreign currency exchange services and global money transfer services.

Our primary product offerings include comprehensive ATM, point-of-sale ("POS"), card outsourcing, card issuing and merchant acquiring services, software solutions, electronic distribution of prepaid mobile airtime, managed services and other electronic payment products, foreign currency exchange services and global money transfer services.

We operate in the following three segments:

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Our executive offices are located in Leawood, Kansas, USA.

With approximat ely $583.2 million of our revenues denominated in currencies other than the U.S.

With approximat ely 75% of our revenues denominated in currencies other than the U.S.

dollar, any significant changes in foreign currency exchange rates will likely have a significant impact on our results of operations (for a further discussion, see Item 1 A - Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2022 ).

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Each operating segment’s sources of revenues are described below.

EFT Processing Segment — Revenues in the EFT Processing Segment, which represented approximately 24% of total consolidated revenues for the three months ended March 31, 2023 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.

EFT Processing Segment — Revenues in the EFT Processing Segment, which represented approximately 30% and 27% of total consolidated revenues for the three and six months ended June 30, 2023 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 applicati on software and sales of related hardware.

epay Segment — Revenues in the epay Segment, which represented approximately 30% o f total consolidated revenues for the three months ended March 31, 2023 a re primarily derived from commissions earned from the distribution of electronic content, vouchers, and physical gifts and commissions or processing fees rec eived from mobile phone operators for the processing and distribution of prepaid mobile airtime.

Branded payments, which includes the distribution of digital media content, were 66 % o f epay Segment revenues for the three months ended March 31, 2023.

epay Segment — Revenues in the epay Segment, which represented approximately 28% and 29% o f total consolidated revenues for the three and six months ended June 30, 2023 a re primarily derived from commissions earned from the distribution of electronic content, vouchers, and physical gifts and commissions or processing fees rec eived from mobile phone operators for the processing and distribution of prepaid mobile airtime.

Branded payments, which includes the distribution of digital media content, w ere 66% of epay Segment revenues for both the three and six months ended June 30, 2023.

Branded payments include 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.

Money Transfer Segment — Revenues in the Money Transfer Segment, which represented approximately 46% of total consolidated revenues for the three months ended March 31, 2023 , 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.

Money Transfer Segment — Revenues in the Money Transfer Segment, which represented approximately 42% and 44% of total consolidated revenues for the three and six months ended June 30, 2023 , 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 network in place comprised of agents, customer service representatives, Company-owned stores, our websites and mobile applications, along with a worldwide network of correspondent agents, consisting primarily of financial institutions in the transfer destination countries.

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The EFT Segment is also dependent to a large degree on consumer travel patterns over which we have no control.

Although international travel is returning to pre-pandemic levels in many parts of the globe, the war in Ukraine and related sanctions on Russia are negatively affecting the number of individuals traveling to and from Ukraine and the countries that border Ukraine and the number of Russian tourists in many locations where we have ATMs .

2) The epay Segment opportunities include renewing existing and negotiating new agreements in target markets in which we operate, primarily with digital content providers, mobile operators, financial institutions and retailers.

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The opportunities to expand are contingent on our ability to effectively leverage our network of bank accounts for digital money transfer delivery, maintaining our physical agent network, cross selling opportunities with our EFT and epay Segments and our penetration into high growth money transfer corridors.

The challenges inherit in these opportunities include maintaining compliance with all regulatory requirements, maintaining all required licenses, ensuring the recoverability of funds advanced to agents and the continued reliance on the technologies required to operate our business.

The challenges inherent in these opportunities include maintaining compliance with all regulatory requirements, maintaining all required licenses, ensuring the recoverability of funds advanced to agents and the continued reliance on the technologies required to operate our business.

The volume of transactions processed on our network is impacted by shifts in our customer base, which can change rapidly with worker migration patterns and changes in unbanked populations across the globe.

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Recently, inflation has been increasing our cost structure in many parts of the world in which we operate.

During the three months ended March 31, 2023, almost all of the remaining COVID-19 related travel restrictions and social distancing orders were lifted.

We recognize that there is a fair amount of uncertainty regarding COVID-19 now.

COVID-19 related cases continue to be reported globally and new variants continue to evolve.

New developments related to COVID-19 or other diseases could also result in the re-imposition of travel restrictions or social distancing orders to various parts of the world.

SEGMENT SUMMARY RESULTS OF OPERATIONS

Revenues and operating income by segment for the three months ended March 31, 2023 and 2022 are summarized in the tables below:

Revenues for the Three Months Ended March 31,

Revenues and operating income by segment for the three and six months ended June 30, 2023 and 2022 are summarized in the tables below:

Revenues for the Three Months Ended June 30,

Year-over-Year Change

Revenues for the Six Months Ended June 30,

Year-over-Year Change

(dollar amounts in millions)

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Corporate services, eliminations and other

Operating Income (Loss) for the Three Months Ended March 31,

Operating Income (Loss) for the Three Months Ended June 30,

Year-over-Year Change

Operating Income (Loss) for the Six Months Ended June 30,

Year-over-Year Change

(dollar amounts in millions )

Increase (Decrease)

EFT Processing

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Average Translation Rate

Three Months Ended March 31,

Three Months Ended June 30,

Average Translation Rate

Six Months Ended June 30,

Currency (dollars per foreign currency)

Increase (Decrease)

Australian dollar

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New Zealand dollar

COMPARISON OF OPERATING RESULTS FOR THE THREE MONTHS ENDED MARCH 31 , 2023 AND 2022

COMPARISON OF OPERATING RESULTS FOR THE THREE ANDSIX MONTHS ENDED JUNE 30 , 2023 AND 2022

EFT PROCESSING SEGMENT

The following table summarizes the results of operations for our EFT Processing Segment for the three months ended March 31, 2023 and 2022 :

Three Months Ended March 31,

The following table summarizes the results of operations for our EFT Processing Segment for the three and six months ended June 30, 2023 and 2022 :

Three Months Ended June 30,

Year-over-Year Change

Six Months Ended June 30,

Year-over-Year Change

(dollar amounts in millions )

(Decrease) Percent

Total revenues

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Total operating expenses

Operating income(loss)

Operating income

Transactions processed (millions)

Active ATMs as of March 31,

Active ATMs as of June 30,

Average Active ATMs

EFT Processing Segment total revenues were $192.2 million for the three months ended March 31, 2023 , an increase of $46.6 million or 32 % compared to the same period in 2022 .

EFT Processing Segment total revenues were $282.4 million for the three months ended June 30, 2023 , an increase of $33.4 million or 13 % compared to the same period in 2022 .

EFT Processing Segment total revenues were $474.6 million for the six months ended June 30, 2023, an increase of $80.0 million or 20%.

The increase in revenues was primarily due to the increase in domestic and international cash withdrawal transactions resulting from the reduction of travel restrictions across Europe, the increase in low-value point-of-sale transactions in Europe and low-value payment processing transactions in Asia Pacific.

Foreign currency movements decreased revenues by approximately $11.7 m illion for the three months ended March 31, 2023 compared to the same period in 2022 .

Average monthly revenues per ATM increased to $1,384 for the three months ended March 31, 2023 compared to $ 1,118 for the same period in 2022 .

Revenues per transaction decreased to $0.10 for the three months ended March 31, 2023 compared to $ 0.11 for the same period in 2022 .

The increase in average monthly revenues per ATM was primarily due to the increase in domestic and international cash withdrawal transactions resulting from increased travel across Europe, partially offset by the increase in volume of 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 $0.8 m illion and $0.4 million for the three and six months ended June 30, 2023 compared to the same period in 2022 .

Average monthly revenues per ATM increased to $1,872 for the three months ended June 30, 2023 compared to $ 1,696 for the same period in 2022 .

Average monthly revenues per ATM increased to $1,638 for the six months ended June 30, 2023 compared to $1,425 for the same period in 2022.

Revenues per transaction decreased to $0.14 for the three months ended June 30, 2023 compared to $ 0.16 for the same period in 2022 .

Direct operating costs

EFT Processing Segment direct operating costs were $119.0 million for the three months ended March 31, 2023 , an increase of $25.7 million or 28 % compared to the same period in 2022 .

EFT Processing Segment direct operating costs were $142.1 million for the three months ended June 30, 2023 , an increase of $18.3 million or 15 % compared to the same period in 2022 .

EFT Processing Segment direct operating costs were $261.1 million for the six months ended June 30, 2023 , an increase of $44.0 million or 20 % compared to the same period in 2022 .

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.

The increase in direct costs was primarily due to the increase in domestic and international cash withdrawal transactions resulting from the increase in travel across Europe, the increase in low-value point-of-sale transactions in Europe and low-value payment processing transactions in Asia Pacific.

Foreign currency movements decreased direct operating costs by approximately $6.6 million for the three months ended March 31, 2023 compared to the same period in 2022 .

Gross profit, which is calculated as revenues less direct operating costs, was $73.2 million for the three months ended March 31, 2023 , an increase of $20.9 million or 40% compared to $52.3 million for the same period in 2022 .

Gross profit as a percentage of revenues (“gross margin”) increased to 38.1% for the three months ended March 31, 2023 , compared to 35.9 % for the same period in 2022 .

The increase in gross profit and gross margin were primarily due to the incremental volume of transactions that were processed on our network relative to the fixed costs incurred, and the higher number of high value and high margin DCC transactions due to increased travel.

Fluctuations in foreign currency exchange rates decreased direct operating costs by approximately $1.0 million and $0.1 million for the three and six months ended June 30, 2023 compared to the same period in 2022 .

Gross profit, which is calculated as revenues less direct operating costs, was $140.3 million for the three months ended June 30, 2023, an increase of $15.1 million or 12% compared to $125.2million for the same period in 2022.

Gross profit, was $213.5 million for the six months ended June 30, 2023, an increase of $36.0 million or 20% compared to $177.5 million for the same period in 2022.

Gross profit as a percentage of revenues (“gross margin”) decreased to 49.7% and 45.0% for the three and six months ended June 30, 2023, compared to 50.3% and 45.0% for the same periods in 2022.

The increase in gross profit was primarily due to the incremental volume of transactions that were processed on our network relative to the fixed costs incurred, and the higher number of high value and high margin DCC transactions due to increased travel.

Salaries and benefits

Salaries and benefits expenses were $27.5 million for the three months ended March 31, 2023, an increase of $2.3 million or 9% c ompared to the same period in 2022 .

Salaries and benefits expenses were $30.8 million for the three months ended June 30, 2023, an increase of $3.1 million or 11% c ompared to the same period in 2022 .

Salaries and benefits expenses were $58.3 million for the six months ended June 30, 2023, an increase of $5.4 million or 10% c ompared to the same period in 2022 .

The increase is primarily due to an increase in salaries and headcount to support the growth of the business.

Foreign currency movements in the countries in which we employ our workforce reduced these expenses by $1.9 million for the three months ended March 31, 2023 compared to the same period in 2022.

As a percentage of revenues, these expenses decreased to 14.3 % for the three months ended March 31, 2023 , compared to 17.3% for the same period in 2022 .

Fluctuations in foreign currency exchange rates in the countries in which we employ our workforce had no significant impact.

As a percentage of revenues, these expenses decreased to 10.9 % and 12.3% for the three and six months ended June 30, 2023 , compared to 11.1% and 13.4% for the same periods in 2022 .

Selling, general and administrative

Selling, general and administrative expenses were $16.1 million for the three months ended March 31, 2023 , an increase of $5.0 million or 45% compared to the same period in 2022 .

Selling, general and administrative expenses were $16.6 million for the three months ended June 30, 2023 , a decrease of $0.4 million or 2% compared to the same period in 2022 .

The decrease was primarily due to a recovery of tourism in Europe compared to the prior year.

Selling, general and administrative expenses were $32.7 million for the six months ended June 30, 2023 , an increase of $4.6 million or 16% compared to the same period in 2022 .

The increase was primarily due to an increase in professional fees.

As a percentage of revenues, these expenses increased to 8.4 % for the three months ended March 31, 2023 , compared to 7.6 % for the same period in 2022 .

As a percentage of revenues, these expenses decreased to 5.9 % and 6.9% for the three and six months ended June 30, 2023 , compared to 6.8 % and 7.1% for the same periods in 2022 .

Depreciation and amortization

Depreciation and amortization expenses were $22.7 million for the three months ended March 31, 2023, an increase of $0.4 million or 2% compared to the same period in 2022 .

As a percentage of revenues, these expenses decreased to 11.8 % for the three months ended March 31, 2023 , compared to 15.3 % for the same period in 2022 .

Depreciation and amortization expenses were $23.8 million for the three months ended June 30, 2023, a decrease of $1.9 million or 7% compared to the same period in 2022 .

Depreciation and amortization expenses were $46.5 million for the six months ended June 30, 2023, a decrease of $1.5 million or 3% compared to the same period in 2022 .

As a percentage of revenues, these expenses decreased to 8.4 % and 9.8% for the three and six months ended June 30, 2023 , compared to 10.3 % and 12.2% for the same periods in 2022 .

Operating income

EFT Processing Segment had operating income of $6.9 million for the three months ended March 31, 2023, an increase of $13.2 million or 210% c ompared to the same period in 2022 .

O perating income as a percentage of revenues (“operating margin”) increased to 3.6% for the three months ended March 31, 2023 , compared to (4.3%) for the same period in 2022 .

The increase in operating income and improved operating margin were primarily due to increased volumes processed on our network, and associated revenues, compared to the same period in 2022.

The following table presents the results of operations for the three months ended March 31, 2023 and 2022 for our epay Segment:

Three Months Ended March 31,

EFT Processing Segment had operating income of $69.1 million for the three months ended June 30, 2023, an increase of $14.3 million or 26% c ompared to the same period in 2022 .

EFT Processing Segment had operating income of $76.0 million for the six months ended June 30, 2023, an increase of $27.5 million or 57% compared to the same period in 2022 .

O perating income as a percentage of revenues (“operating margin”) increased to 24.5% and 16.0% for the three and six months ended June 30, 2023 , compared to 22.0% and 12.3% for the same periods in 2022 .

The increase in operating income and improved operating margin were primarily due to increased volumes processed on our network, and associated revenues, compared to the same periods in 2022.

The following table presents the results of operations for the three and six months ended June 30, 2023 and 2022 for our epay Segment:

Three Months Ended June 30,

Year-over-Year Change

Six Months Ended June 30,

Year-over-Year Change

(dollar amounts in millions )

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(Decrease) Percent

Increase (Decrease) Amount

(Decrease) Percent

Total revenues

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Operating income

Transactions processed (millions)

epay Segment total revenues were $237.4 million for the three months ended March 31, 2023 , an increase of $1.6 million or 1% compared to the same period in 2022 .

The increase in revenue for the three months ended March 31, 2023 is driven by continued expansion in mobile and digital branded payments.

Foreign currency movements decreased revenue by approximately $10.2 million for the three months ended March 31, 2023 , compared to the same period in 2022.

Revenue per transaction decreased to $0.24 for the three months ended March 31, 2023 , compared to $0.27 for the same period in 2022 .

The decrease in revenue per transaction was primarily due to the increase in the number of mobile transactions processed in a region where we generally earn lower revenues per transaction.

Transactions proce ssed (mi llions)

epay Segment total revenues were $263.8 million for the three months ended June 30, 2023 , an increase of $36.1 million or 16% compared to the same period in 2022 .

epay Segment total revenues were $501.2 million for the six months ended June 30, 2023 , an increase of $37.7 million or 8% compared to the same period in 2022 .

The increase in revenue for the three months ended June 30, 2023 was driven by continued expansion in mobile and digital branded payments.

Fluctuations in foreign currency exchange rates increased revenue by approximately $1.3 and $0.2 million for the three and six months ended June 30, 2023 , compared to the same periods in 2022.

Revenue per transaction increased to $0.27 and $0.26 for the three and six months ended June 30, 2023 , respectively, compared to $0.20 and $0.23 for the same periods in 2022 .

The increase in revenue per transaction was primarily due to the decrease in the number of mobile transactions processed in a region where we generally earn lower revenues per transaction for the three and six month periods.

Direct operating costs

epay Segment direct operating costs were $178.1 million for the three months ended March 31, 2023 , and were essentially flat .

epay Segment direct operating costs were $204.2 million for the three months ended June 30, 2023 , an increase of $30.5 million or 18% compared to the same period in 2022 .

epay Segment direct operating costs were $382.3 million for the six months ended June 30, 2023 , an increase of $30.3 million or 9% compared to the same period in 2022 .

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 movements decrease direct operating costs by $7.4 million for the three moths ended March 31, 2023 compared to the same period in 2022 .

Gross profit was $59.3 million for the three months ended March 31, 2023 , an increase of $1.8 million or 3.1% compared to $57.5 million for the same period in 2022 .

Gross margin increased to 25.0% for the three months ended March 31, 2023 , compared to 24.4 % for the same period in 2022 .

The increase in gross profit and gross margin is primarily due to shift in mix of transactions processed .

Foreign currency exchange rates increased direct operating costs by $1.2 million and $0.2 million for the three and six months ended June 30, 2023 compared to the same periods in 2022 .

Gross profit was $59.6 million for the three months ended June 30, 2023 , an increase of $5.6 million or 10% compared to $54.0 million for the same period in 2022 .

Gross profit was $118.9 million for the six months ended June 30, 2023 , an increase of $7.4 million or 7% compared to $111.5 million for the same period in 2022 .

Gross margin decreased to 22.6% and 23.7% for the three and six months ended June 30, 2023 , compared to 23.7% and 24.1% for the same periods in 2022 .

The decrease in gross profit and gross margin was primarily due to the shift in the mix of transactions processed .

Salaries and benefits

Salaries and benefits expenses were $21.4 million for the three months ended March 31, 2023 , an increase of $1.2 million or 6% compared to the same period in 2022 .

The fluctuations in salaries and benefits were driven by an increase in salaries and headcount to support the growth of the business, offset by a $0.9 million decrease from foreign currency movements for the three months ended March 31, 2023 , compared to the same period in 2022.

As a percentage of revenues, these expenses increased to 9.0 % for the three months ended March 31, 2023, compared to 8.6% for the same period in 2022 .

Salaries and benefits expenses were $22.0 million for the three months ended June 30, 2023 , an increase of $2.2 million or 11% compared to the same period in 2022 .

Salaries and benefits expenses were $43.4 million for the six months ended June 30, 2023 , an increase of $3.4 million or 9% compared to the same period in 2022 .

The fluctuations in salaries and benefits were driven by an increase in salaries and headcount to support the growth of the business.

As a percentage of revenues, these expenses decreased and increased to 8.3 % and 8.7%, respectively, for the three and six months ended June 30, 2023, compared to 8.7% and 8.6% for the same periods in 2022 .

Selling, general and administrative

Selling, general and administrative expenses were $8.8 million for the three months ended March 31, 2023 , a decrease of ($0.6 million) or (6 %) compared to the same period in 2022 .

As a percentage of revenues, these expenses decreased to 3.7 % for the three months ended March 31, 2023 , compared to 4.0 % for the same period in 2022 .

Selling, general and administrative expenses were $9.1 million for the three months ended June 30, 2023 , an increase of $0.8 million or 10 % compared to the same period in 2022 .

Selling, general and administrative expenses were $17.9 million for the six months ended June 30, 2023 , an increase of $0.2 million or 1 % compared to the same periods in 2022 .

As a percentage of revenues, these expenses decreased to 3.4 % and 3.6% for the three and six months ended June 30, 2023 , compared to 3.6 % and 3.8% for the same periods in 2022 .

Depreciation and amortization

Depreciation and amortization expenses were $1.6 million for the three months ended March 31, 2023 , a decrease of ($0.1 million) or (6 %) compared to the same period in 2022 .

Depreciation and amortization expenses were $1.7 million for the three months ended June 30, 2023 , an increase of $0.1 million or 6 % compared to the same period in 2022 .

Depreciation and amortization expenses were $3.3 million for both the six months ended June 30, 2023 and 2022 .

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 the three months ended March 31, 2023

As a percentage of revenues, these expenses were 0.6% and 0.7% for the three and six months ended June 30, 2023 , respectively, compared to 0.7% and 0.7% for the same periods in 2022.

Operating income

epay Segment operating income was $27.5 million for the three months ended March 31, 2023 , an increase of $1.3 million or 5% c ompared to the same period in 2022 .

Operating margin increased to 11.6 % for the three months ended March 31, 2023 , compared to 11.1 % for the same period in 2022 .

Operating income per transaction was $0.03 for both the three m onths ended March 31, 2023 and 2022 .

The changes in operating income and operating margin for the three months ended March 31, 2023 compared to the same period in 2022 were primarily due to the shift in the mix of transactions processed .

epay Segment operating income was $26.8 million for the three months ended June 30, 2023 , an increase of $2.5 million or 10% c ompared to the same period in 2022 .

epay Segment operating income was $54.3 million for the six months ended June 30, 2023 , an increase of $3.8 million or 8% c ompared to the same period in 2022 .

Operating margin decreased to 10.2 % and 10.8 % for the three and six months ended June 30, 2023 , compared to 10.7 % and 10.9% for the same periods in 2022 .

Operating income per transaction was $ 0.03 f or both the three and six m onths ended June 30, 2023, respectively compared to $0.02 and $0.03 for same periods in 2022 .

The changes in operating income and operating margin for the three and six months ended June 30, 2023 compared to the same periods in 2022 were primarily due to the shift in the mix of transactions processed .

MONEY TRANSFER SEGMENT

The following table presents the results of operations for the three months ended March 31, 2023 and 2022 for the Money Transfer Segment:

Three Months Ended March 31,

The following table presents the results of operations for the three and six months ended June 30, 2023 and 2022 for the Money Transfer Segment:

Three Months Ended June 30,

Year-over-Year Change

Six Months Ended June 30,

Year-over-Year Change

(dollar amounts in millions )

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(Decrease) Percent

Increase (Decrease) Amount

Increase (Decrease) Percent

Total revenues

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Transactions processed (millions)

Money Transfer Segment total revenues were $359.4 million for the three months ended March 31, 2023 , an increase of $20.4 million or 6 % compared to the same period in 2022 .

Money Transfer Segment total revenues were $394.8 million for the three months ended June 30, 2023 , an increase of $26.3 million or 7 % compared to the same period in 2022 .

Money Transfer Segment total revenues were $754.2 million for the six months ended June 30, 2023 , an increase of $46.7 million or 7 % compared to the same period in 2022 .

The increase in revenues was primarily due to an increase in international-originated money transfers, U.S.

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domestic transactions.

Revenues per transaction decreased to $9.57 for the three months ended March 31, 2023 , compared to $10.12 for the same period in 2022 due to a shift in the mix of transactions processed.

Foreign currency movements decreased revenues by approximately $10.1 million for the three months ended March 31, 2023, compared to the same period in 2022 .

Revenues per transaction decreased to $9.61 and $9.60 for the three and six months ended June 30, 2023 , compared to $9.88 and $10.01 for the same period in 2022 due to a shift in the mix of transactions processed.

Fluctuations in foreign currency exchange rates increased revenues by approximately $1.0 million and $34 thousand for the three and six months ended June 30, 2023, compared to the same periods in 2022 .

Direct operating costs

Money Transfer Segment direct operating costs were $196.3 million for the three months ended March 31, 2023 , an increase of 7.8 million or 4% c ompared to the same period in 2022 .

Money Transfer Segment direct operating costs were $213.7 million for the three months ended June 30, 2023 , an increase of 8.7 million or 4% c ompared to the same period in 2022 .

Money Transfer Segment direct operating costs were $410.0 million for the six months ended June 30, 2023 , an increase of $16.5 million or 4 % compared to the same period in 2022 .

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 of international-originated and U.S.

outbound money transfer transactions, offset by foreign currency movements that decreased direct operating costs by approximately $5.1 million for the three months ended March 31, 2023, compared to the same period in 2022 .

Gross profit was $163.1 million for the three months ended March 31, 2023 , an increase of $12.6 million or 8.4% compared to $150.5 million for the same period in 2022 .

Gross margin increased to 45.4% for the three months ended March 31, 2023, compared to 44.4 % for the same period in 2022.

outbound money transfer transactions.

Gross profit was $181.1 million for the three months ended June 30, 2023 , an increase of $17.6 million or 11% compared to $163.5 million for the same period in 2022 .

Gross profit was $344.2 million for the six months ended June 30, 2023 , an increase of $30.2 million or 10% compared to $314.0 million for the same period in 2022 .

Gross margin increased to 45.9% and 45.6% for the three and six months ended June 30, 2023, compared to 44.4% and 44.4% for the same periods in 2022.

The increase in gross profit and gross margin was primarily due t o increases in international-originated money transfers, U.S.

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Salaries and benefits

Salaries and benefits expenses were $74.3 million for the three months ended March 31, 2023, an increase of $7.0 million or 10% compared to the same period in 2022 .

Salaries and benefits expenses were $78.5 million for the three months ended June 30, 2023, an increase of $10.5 million or 15% compared to the same period in 2022 .

Salaries and benefits expenses were $152.8 million for the six months ended June 30, 2023, an increase of $17.5 million or 13% compared to the same period in 2022 .

The increase in salaries and benefits was primarily driven by an increase in salaries and headcount to support the growth of the business.

As a percentage of revenues, these expenses increased to 20.7 % for the three months ended March 31, 2023 , compared to 19.9% for the same period in 2022 .

As a percentage of revenues, these expenses increased to 19.9 % and 20.3% for the three and six months ended June 30, 2023 , compared to 18.5% and 19.1%, for the same periods in 2022 .

Selling, general and administrative

Selling, general and administrative expenses were $47.7 million for the three months ended March 31, 2023 , an increase of $6.7 million or 16 % compared to the same period in 2022 .

The increase was primarily due to an increase in hardware and software expenses, professional fees, marketing expenses and travel related expenses.

As a percentage of revenues, these expenses increased to 13.3 % for the three months ended March 31, 2023 , compared to 12.1% for the same period in 2022 .

Selling, general and administrative expenses were $47.3 million for the three months ended June 30, 2023 , an increase of $1.0 million or 2 % compared to the same period in 2022 .

Selling, general and administrative expenses were $95.0 million for the six months ended June 30, 2023 , an increase of $7.7 million or 9 % compared to the same period in 2022 .

The increase was primarily due to an increase in hardware and soft ware expenses, professional fees, marketing expenses and travel related expenses.

As a percentage of revenues, these expenses decreased and increased to 12.0 % and 12.6% for the three and six months ended June 30, 2023 , compared to 12.6% and 12.3% for the same periods in 2022 .

Depreciation and amortization

Depreciation and amortization expenses were $8.5 million for the three months ended March 31, 2023, a decrease of $0.4 million or 4 % compared to the same period in 2022 .

Depreciation and amortization 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 2.4 % for the three months ended March 31, 2023, compared to 2.6 % for the same period in 2022 .

Depreciation and amortization expenses were $8.1 million for the three months ended June 30, 2023, a decrease of $0.5 million or 6 % compared to the same period in 2022 .

Depreciation and amortization expenses were $16.6 million for the six months ended June 30, 2023, a decrease of $0.9 million or 5 % compared to the same period in 2022 .

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 2.1 % and 2.2% for the three and six months ended June 30, 2023, compared to 2.3 % and 2.5% for the same periods in 2022 .

Operating income

Money Transfer Segment operating income was $32.6 million for the three months ended March 31, 2023 , a decrease of $0.7 million or 2 % compared to the same period in 2022 .

Operating margin decreased to 9.1% for the three months ended March 31, 2023 , compared to 9.8 % for the same period in 2022 .

Operating income per transaction decreased to $0.87 for the three months ended March 31, 2023 , compared to $1.00 for the same period in 2022 due to a shift in the mix of transactions processed .

Money Transfer Segment operating income was $47.2 million for the three months ended June 30, 2023 , an increase of $6.6 million or 16 % compared to the same period in 2022 .

Money Transfer Segment operating income was $79.8 million for the six months ended June 30, 2023 , an increase of $5.9 million or 8 % compared to the same period in 2022 .

Operating margin increased to 12.0% and 10.6% for the three and six months ended June 30, 2023 , compared to 11.0 % and 10.4% for the same periods in 2022 .

Operating income per transaction increased and decreased to $ 1.15 and $1.02, respectively, for the three and six months ended June 30, 2023 , compared to $1.09 and $1.05 for the same period in 2022 due to a shift in the mix of transactions processed .

CORPORATE SERVICES

The following table presents the operating expenses for the three months ended March 31, 2023 and 2022 for Corporate Services:

Three-Month Ended March 31,

The following table presents the operating expenses for the three and six months ended June 30, 2023 and 2022 for Corporate Services:

Three Months Ended June 30,

Year-over-Year Change

Six Months Ended June 30,

Year-over-Year Change

(dollar amounts in millions )

Increase (Decrease)

Salaries and benefits

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Corporate operating expenses

Total Corporate operating expenses were $21.4 million for the three months ended March 31, 2023 , an increase of $4.9 million or 30% compared to the same period in 2022 .

The increase is primarily due to an increase in long-term and short-term incentive compensation expense of $4.5 million for the three months ended March 31, 2023, compared to the same period in 2022, due to improved company performance.

Total Corporate operating expenses were $20.5 million and $41.9 million for the three and six months ended June 30, 2023 , an increase of $1.9 million or 10% and $6.8 million or 19% compared to the same periods in 2022 .

The increase is primarily due to an increase in long-term and short-term incentive compensation expense for the three and six months ended June 30, 2023, compared to the same periods in 2022, due to improved company performance.

OTHER EXPENSE, NET

Three Month Ended March 31,

Three Months Ended June 30,

Year-over-Year Change

Six Months Ended June 30,

Year-over-Year Change

(dollar amounts in millions )

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(Decrease) Percent

Increase (Decrease) Amount

(Decrease) Percent

Interest income

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Other expense, net

Interest income

Interest income was $3.5 million for the three months ended June 30, 2023 , an increase of $3.3 million or 1,650 % compared to the same period in 2022 .

Interest income was $6.1 million for the six months ended June 30, 2023 , an increase of $5.8 million or 1,933% compared to the same period in 2022 .

This increase was driven by an increase in interest rates on our interest bearing bank accounts.

Interest expense

Interest expense was $10.1 million for the three months ended March 31, 2023 , an increase of $ 4.0 million or 66 % compared to the same period in 2022 .

This increase was driven by an increase in interest rates on our Credit Facility from 1.29% at March 31, 2022 to 5.97% at March 31, 2023.

Interest expense was $14.0 million for the three months ended June 30, 2023 , an increase of $ 5.2 million or 59 % compared to the same period in 2022 .

Interest expense was $24.1 million for the six months ended June 30, 2023 , an increase of $9.2 million or 62% compared to the same period in 2022 .

This increase was driven by an increase in interest rates on our Credit Facility.

Foreign currency exchange loss, net

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dollar weakens, our corporate entities will record foreign currency exchange gains.

We recorded net foreign currency exchange losses of $1.1 million for the three months ended March 31, 2023 , compared to a net foreign currency exchange losses of $5.5 million for the same period in 2022.

These realized and unrealized foreign currency exchange losses reflect the fluctuation in the value of the U.S.

We recorded net foreign currency exchange gains of $6.3 million and $5.2 million for the three and six months ended June 30, 2023 , compared to net foreign currency exchange losses of $14.7 million and $20.2 million for the same periods in 2022.

These realized and unrealized foreign currency exchange gains and 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 periods.

INCOME TAX EXPENSE

The Company's effective income tax rate was 4 6.

5% for the three months ended March 31, 2023 , compared to 67.4% for the same period ended March 31, 2022.

The Company's effective income tax rate for the three months ended March 31, 2023 was higher than the applicable statutory income tax rate of 21 % as a result of certain foreign earnings being subject to higher statutory tax rates.

The Company's effective income tax rate for the three months ended March 31, 2022 was higher than the applicable statutory income tax rate of 21 % mainly as a result of certain foreign earnings being subject to higher local tax rates.

The Company's effective income tax rate for the three months ended March 31, 2022 was higher than the applicable statutory income tax rate of 21% as a result of the Company’s U.S.

deferred tax activity on foreign exchange positions and certain foreign earnings being subject to higher local statutory tax rates.

The Company's effective income tax rate was 27.3% and 31.9% for the three and six months ended June 30, 2023, compared to 26.7% and 36.7% for the same periods ended June 30, 2022.

The Company's effective income tax rate for the three and six months ended June 30, 2023 was higher than the applicable statutory income tax rate of 21% as a result of the Company’s U.S.

deferred tax activity and certain foreign earnings being subject to higher local statutory tax rates.

NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTERESTS

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NET INCOME (LOSS) ATTRIBUTABLE TO EURONET

Net income attributable to Euronet was $20.1 million for the three months ended March 31, 2023, an increase of $11.9 million or 145% compared to t he same period in 2022 .

The increase in net income was primarily attributable to the $68.7 million increase in revenues, largely driven by the increases within the EFT Segment as tourism and cross-border travel increased during the first quarter of 2023 compared to the first quarter of 2022.

The increased revenues led to a $35.3 million increase in gross profit, with $20.9 million of this increase within the EFT Segment and with $12.6 million of this increase within the Money Transfer Segment .

The increase in gross profit of money transfer was partially offset by a $7.0 million increase in salaries and benefits expense, and a $6.7 million increase in selling, general and administrative expense.

Net income attributable to Euronet was $86.1 million for the three months ended June 30, 2023, an increase of $28.8 million or 50% compared to t he same period in 2022 .

The increase in net income was primarily attributable to the $95.8 million increase in revenues, across all of our three segments, largely driven by successful business operations.

The increased revenues led to a $38.4 million increase in gross profit.

The increase in gross profit was partially offset by a $10.5 million increase in salaries and benefits expense in the Money Transfer segment.

Net income attributable to Euronet was $106.2 million for the six months ended June 30, 2023, an increase of $40.7 million or 62% compared to t he same period in 2022 .

The increase in net income was pri marily attributable to the $164.5 million increase in revenues, largely driven by increases within the EFT Segment as tourism and cross-border travel increased.

The increased revenues led to a $73.7 million increase in gross profit.

The increase in gross profit was partially offset by a $33.2 million increase in salaries and benefits expense.

LIQUIDITY AND CAPITAL RESOURCES

Working capital

As of March 31, 2023 , we had working capital of $1,436.2 million , which is calculated as the difference between total current assets and total current liabilities, compared to working capital of $1,372.6 million as of December 31, 2022 .

The increase in working capital was primarily due to a positive earnings, partially offset by $28.3 million of share repurchases during the quarter ended March 31, 2023 .

Also the change in working capital line items was negatively impacted as December 31, 2022 ended on a weekend day, which increased funding needs for our agents.

Our ratio of current assets to current liabilities was 1.75 and 1.58 at March 31, 2023 and December 31, 2022 , respectively.

As of June 30, 2023 , we had working capital of $1,207.4 million , which is calculated as the difference between total current assets and total current liabilities, compared to working capital of $1,372.6 million as of December 31, 2022 .

The decrease in working capital was primarily due to a decrease in prepayments.

Our ratio of current assets to current liabilities was 1.52 and 1.58 at June 30, 2023 and December 31, 2022 , respectively.

We require substantial working capital to finance operations.

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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, 2023 , we had $627.2 million of 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 $111.6 million from $515.6 million as of December 31, 2022 to $627.2 million as of March 31, 2023 as a result of the increase in number of active ATMs as of March 31, 2023 compared to December 31, 2022.

The Company has $1,065.8 million of unrestricted cash as of March 31, 2023 compared to $1,131.2 million as of December 31, 2022 .

The decrease in unrestricted cash was primarily due to $111.6 million allocated from unrestricted cash to ATM cash and the $28.3 million of share repurchases during the first quarter of 2023, partially offset by positive earnings.

Including the $627.2 million of cash in ATMs at March 31, 2023 , we have access to $1,937.8 million in available cash, and $715.9 million available under the Credit Facility with no significant long-term debt principal payments until March 2025.

The following table identifies cash and cash equivalents provided by/(used in) our operating, investing and financing activities for the three months ended March 31, 2023 and 2022 (in millions):

Three Months Ended March 31,

As of June 30, 2023 , we had $776.3 million of 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 $260.7 million from $515.6 million as of December 31, 2022 to $776.3 million as of June 30, 2023 as a result of the increase in number of active ATMs as of June 30, 2023 compared to December 31, 2022.

The Company has $1,137.5 million of unrestricted cash as of June 30, 2023 compared to $1,131.2 million as of December 31, 2022 .

Including the $776.3 million of cash in ATMs at June 30, 2023 , we have access to $2,192.6 million in available cash, and $1,057.2 million available under the Credit Facility with no significant long-term debt principal payments until March 2025.

The following table identifies cash and cash equivalents provided by/(used in) our operating, investing and financing activities for the six months ended June 30, 2023 and 2022 (in millions):

Six Months Ended June 30,

Cash and cash equivalents and restricted cash provided by (used in):

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Effect of foreign currency exchange rate changes on cash and cash equivalents and restricted cash

Increase (decrease) in cash and cash equivalents and restricted cash

Increase in cash and cash equivalents and restricted cash

Operating activity cash flow

Cash flows provided by operating activities were $3.3 million f or the three months ended March 31, 2023 compared to cash flows provided by operating activities of $5.7 million for the same period in 2022 .

The decrease in operating cash flows was primarily due to fluctuations in working capital mainly associated with the timing of the settlement processes with content providers in the epay Segment, with correspondents in the Money Transfer Segment, and with card organizations and banks in the EFT Processing Segment, partially offset by the $ 20.1 million increase in net income,

Cash flows provided by operating activities were $220.2 million f or the six months ended June 30, 2023 compared to cash flows provided by operating activities of $180.7 million for the same period in 2022 .

The increase in operating cash flows was primarily due to an increase in net income.

Investing activity cash flow

Cash flows used in investing activities were $18.1 million for the three months ended March 31, 2023 compared to $356.9 million for the same period in 2022 .

Cash flows used in investing activities were $45.5 million for the six months ended June 30, 2023 compared to $387.0 million for the same period in 2022 .

The decrease in cash used in investing activities is primarily due to the $331.0 million of cash paid at the closing of PBMA in March 2022.

Additionally, w e used $18.6 million for purchases of property and equipment for the three months ended March 31, 2023 compared to $23.8 million for the same period in 2022 .

Additionally, w e used $41.9 million for purchases of property and equipment for the six months ended June 30, 2023 compared to $53.1 million for the same period in 2022 .

Financing activity cash flow

Cash flows used in financing activities were $4.4 million for the three months ended March 31, 2023 compared to cash flows provided by financing activities of $235.3 million for the same period in 2022 .

Our borrowing activities on the Credit Facility for the three months ended March 31, 2023 consisted of net borrowings of $24.3 million compared to net borrowings of $303.5 million for the same period in 2022.

The decrease in net borrowings on the Credit Facility, during the three months ended March 31, 2023, is primarily the result of decreased funding requirements for acquisitions.

We repurchased $29.2 million of common stock during the three months ended March 31, 2023 compared to $70.5 repurchases during the same period of 2022 .

We received proceeds of $1.0 million and $2.3 million during the three months ended March 31, 2023 and 2022 , respectively, for the issuance of stock in connection with our Stock Incentive Plan.

Cash flows provided by financing activities were $104.4 million for the six months ended June 30, 2023 compared to cash flows provided by financing activities of $491.2 million for the same period in 2022 .

Our borrowing activities on the Credit Facility for the six months ended June 30, 2023 consisted of net borrowings of $132.8 million compared to net borrowings of $663.7 million for the same period in 2022.

The decrease in net borrowings on the Credit Facility, during the six months ended June 30, 2023, is primarily the result of decreased funding requirements for acquisitions.

We repurchased $29.3 million of common stock during the six months ended June 30, 2023 compared to $175.3 million of repurchases during the same period of 2022 .

We received proceeds of $2.4 million and $3.7 million during the six months ended June 30, 2023 and 2022 , respectively, for the issuance of stock in connection with our Stock Incentive Plan.

Effect of exchange rates on cash, cash equivalents and restricted cash

F oreign currency exchange rates for the three months ended March 31, 2023 and 2022 had a negative impact of $33.9 million and $37.5 million, respectively, on cash, cash equivalents, and restricted cash.

The negative impact on cash, cash equivalents, and restricted cash for the three months ended March 31, 2023 was due primarily to the negative impact in the exchange rate of the U.S.

Fluctuations in f oreign currency exchange rates for the six months ended June 30, 2023 and 2022 had a negative impact of $77.4 million and $195.2 million, respectively, on cash, cash equivalents, and restricted cash.

The negative impact on cash, cash equivalents, and restricted cash for the six months ended June 30, 2023 and 2022 was due primarily to the negative impact in the exchange rate of the U.S.

dollar to the euro.

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Credit Facility - On October 24, 2022, the Company amended its revolving credit agreement (the “Credit Facility”) to increase the facility from $1.03 billion to $1.25 billion and to extend the expiration to October 24, 2027.

The revolving credit facility contains a sublimit of up to $250 million, with $150 million committed, for the issuance of letters of credit, a $75 million sublimit for U.S.

dollar swingline loans and a $75 million sublimit for swingline loans in euros or British pounds sterling.

The revolving credit facility contains a sublimit of up to $250 million, with $150 million committed, for the issuance of letters of credit, a $75 million sublimit both for U.S.

dollar swingline loans and for swingline loans in euros or British pounds sterling.

The Credit Facility allows for borrowings in British pounds sterling, euro and U.S.

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The applicable margin for borrowings under the credit facility, based on the Company's current credit rating is 1.25% including the facility fee.

As of March 31, 2023 , we had $479.1 million of borrowings and $55.0 million of stand-by letters of credit outstanding under the Credit Facility.

As of June 30, 2023 , we had $137.6 million of borrowings and $55.2 million of stand-by letters of credit outstanding under the Credit Facility.

The remaining $1,057.2 million under the Credit Facility was available for borrowing.

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The Senior Notes accrue interest at a rate of 1.375% per year, payable annually in arrears on May 22 of each year, until maturity or earlier redemption.

As of March 31, 2023 , we have outstanding €600 million ( $650.4 million ) principal amount of the Senior Notes.

As of June 30, 2023 , we have outstanding € 600 million ( $654.6 million ) principal amount of the Senior Notes.

In addition, we may redeem some or all of these notes on or after February 22, 2026 at their principal amount plus any accrued and unpaid interest.

Uncommitted Credit Agreements - On June 27, 2023, the Company entered into an Uncommitted Credit Agreement for $300 million, fully drawn and outstanding at June 30, 2023, for the sole purpose of providing vault cash for ATMs, that expires no later than November 30, 2023.

The loan bears interest at the rate per annum equal to the secured overnight financing rate (“SOFR”) plus 1.125% .

On June 26, 2023, the Company entered into an Uncommitted Loan Agreement for $150 million, fully drawn and outstanding at June 30, 2023, for the sole purpose of providing vault cash for ATMs, that expires no later than June 21, 2024.

The loan is a Prime rate loan, a Bloomberg Short-term Bank Yield ("BSBY") rate loan plus 0.95% or bears interest at the rate agreed to by the Bank and the Company at the time such loan is made.

Other debt obligations — Certain of our subsidiaries have available credit lines and overdraft facilities to generally supplement short-term working capital requirements, when necessary.

There were $0.2 million outstanding under these other obligation arrangements as of March 31, 2023 and December 31, 2022 .

There was $0.2 million outstanding under these other obligation arrangements as of both June 30, 2023 and December 31, 2022 .

Other uses of capital

Capital expenditures and needs - Total capital expenditures for the three months ended March 31, 2023 were $18.6 million .

Capital expenditures and needs - Total capital expenditures for the six months ended June 30, 2023 were $41.9 million .

These capital expenditures were primarily for the purchase and installation of ATMs in key under-penetrated markets, the purchase of POS terminals for the epay and Money Transfer Segments, and office, data center and company store computer equipment and software.

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We have seen indications that the current inflationary period will put pressure on our results of operations and our financial position.

We have seen some signs of inflation impacting discretionary spend items, such as gaming products, in our epay business as well as some pressure on send amounts in money transfer.

We have seen some signs of inflation impacting discretionary spend items, such as gaming products, in our epay business, discretionary travel expenditures in EFT, as well as some pressure on send amounts in money transfer.

A s a consequence of this inflationary period, w e expect to see increasing expenses forthcoming.

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Our liability under such indemnification provisions may be subject to time and materiality limitations, monetary caps and other conditions and defenses.

As of March 31, 2023 , there were no material changes from the disclosure in our Annual Report on Form 10-K for the year ended December 31, 2022 .

To date, we are not aware of any significant claims made by the indemnified parties or parties to whom we have provided guarantees on behalf of our subsidiaries and, accordingly, no liabilities have been recorded as of March 31, 2023 .

As of June 30, 2023 , there were no material changes from the disclosure in our Annual Report on Form 10-K for the year ended December 31, 2022 .

See also Note 14, Commitments, to the unaudited consolidated financial statements included elsewhere in this report.

CONTRACTUAL OBLIGATIONS

As of March 31, 2023 , there have been no material changes outside the ordinary course of business in our future contractual obligations from the amounts reported within our Annual Report on Form 10-K for the year ended December 31, 2022 .

As of June 30, 2023 , there have been no material changes outside the ordinary course of business in our future contractual obligations from the amounts reported within our Annual Report on Form 10-K for the year ended December 31, 2022 .

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis