Wise plc shares slide despite strong growth: Can dual-listing strategy calm margin pressure worries?

Shares of Wise plc (LSE: WISE) fell sharply on Wednesday, closing down 5.58 percent at 897.50 GBX, following the company’s announcement of its unaudited interim results for the six months ended 30 September 2025. Despite posting double-digit growth in customers, cross-border volume, and underlying income, the share price declined by 53.00 GBX, triggering market-wide debate about the underlying margin trajectory and investor confidence ahead of the company’s dual-listing in the United States.

The stock, which opened at 939.00 GBX and previously closed at 950.50 GBX, has been on a downward trend over recent months. The latest results, while operationally strong, show contracting profit margins and heightened spending, raising concerns among institutional investors about the sustainability of growth without significant profitability dilution.

What financial performance trends defined Wise plc’s first half of FY26 results?

Wise plc reported group revenue of £658.0 million for the first half of fiscal year 2026, up 11 percent compared to £591.9 million in the same period last year. Underlying income, which includes revenue plus the first one percent yield from customer balances, rose 13 percent year-on-year to £749.5 million. The company also reported an underlying profit before tax of £122.0 million, representing a 17 percent decline from £147.1 million in H1 FY25.

Despite top-line growth, reported profit before tax declined to £254.6 million from £292.5 million in the prior-year period, reflecting lower interest income above the one percent threshold and increased reinvestment into product development, marketing, and operational expansion. Wise plc’s cross-border volume reached £84.9 billion, a 24 percent year-on-year rise, with business usage growing 35 percent and personal usage rising 20 percent.

Administrative expenses increased 27 percent to £465.9 million, driven by investments in infrastructure, staff hiring, and dual-listing readiness. This was partially offset by a lower effective tax rate and improved efficiency in cost of sales. However, a key area of investor concern remains the sharp drop in underlying profit before tax margin, which fell from 22.2 percent in H1 FY25 to 16.3 percent in the current period.

How is Wise plc balancing customer growth with strategic investments and pricing pressure?

One of the key metrics contributing to the market’s mixed response was the decline in cross-border take rate, which dropped by 10 basis points year-on-year to 0.52 percent. This reflects a deliberate pricing strategy intended to enhance customer retention and attract higher transaction volumes. Chief Financial Officer Emmanuel Thomassin confirmed that the company is pursuing volume-led growth over short-term profitability, particularly as it scales its platform globally.

Wise plc added 3.5 million new customers in the period, increasing its active user base by 18 percent to 13.4 million. Business customers rose 17 percent to 613,000, while personal users reached 12.8 million. Total customer holdings climbed 37 percent year-on-year to £25.3 billion, with more than £5.6 billion allocated to the ‘Assets’ feature, which is now available in Brazil.

Card volume crossed the £15 billion mark in H1 FY26, generating £132 million in card-related revenue, up 28 percent year-on-year. Non-cross-border revenue now accounts for 41 percent of underlying income, demonstrating revenue diversification beyond traditional FX-based services. The integration of digital tools such as the Travel Hub, invoice generators, and asset investment features has significantly deepened product engagement across user segments.

What strategic milestones are shaping Wise plc’s geographic and regulatory expansion?

Wise plc made major strides in geographic expansion and regulatory licensing during the first half of fiscal year 2026. The company became a direct participant in Brazil’s Pix payment system and is preparing to go live with Japan’s Zengin system. This brings the total number of domestic payment systems directly connected to Wise’s infrastructure to eight, giving the company deeper end-to-end control over cross-border transaction routes and speed.

In October 2025, Wise plc secured regulatory approval from the Central Bank of the United Arab Emirates for Stored Value and Retail Payment Services. It also launched the first locally compliant travel card in India under its AD-2 licence. The expansion of regulatory footprints in these regions is viewed as a strategic enabler for Wise’s ambition to become the go-to infrastructure layer for global cross-border money movement.

Chief Executive Officer Kristo Käärmann reaffirmed the company’s vision to become the foundational network for moving and managing the world’s money. With presence in more than 160 countries and support for over 40 currencies, Wise plc is strategically positioning itself to capture a greater share of the £32 trillion global cross-border payments market.

How is Wise plc’s Wise Platform scaling and what is its long-term contribution potential?

Wise Platform, the business-to-business API offering that enables third parties to embed Wise functionality into their own platforms, continued to scale in the reporting period. It contributed approximately 5 percent of total cross-border volume in H1 FY26, up from 4 percent at the time of the company’s Owners’ Day update earlier this year.

New partnerships announced in the first half include Upwork, UniCredit, Raiffeisen Bank International, and MBSB Bank. These collaborations start with limited functionality and gradually expand to include more currencies and geographies. Wise plc’s management believes Wise Platform could represent more than 10 percent of total cross-border volume in the medium term and exceed 50 percent over the long term.

This channel is strategically important as it leverages Wise’s existing infrastructure with minimal incremental customer acquisition cost, thereby enhancing operating leverage. It is also expected to support margin stabilization over time as more partners adopt the platform.

Why is Wise plc’s share price falling even though the company delivered double‑digit growth across customers, volumes and underlying income?

Investor sentiment turned cautious after the earnings release due to contracting profitability, a declining take rate, and rising administrative costs. While headline revenue and customer growth metrics were strong, the declining underlying profit before tax margin raised concerns about the long-term sustainability of Wise plc’s business model.

In addition, lower interest income on customer balances contributed to the dip in reported profits. Interest income from balances above the first one percent threshold fell 11 percent year-on-year to £205.9 million. Combined with a 14 percent reduction in benefits paid to customers, the total reported profit before tax of £254.6 million still fell short of investor expectations given Wise plc’s recent growth streak.

The ongoing dual-listing process in the United States has also added to investor caution. The company expects to incur approximately £35 million in related one-off costs for fiscal year 2026. Although this move is expected to unlock deeper capital markets access and raise Wise plc’s profile in the North American fintech ecosystem, near-term cost implications are weighing on sentiment.

What is the outlook for Wise plc in the second half of fiscal year 2026 and beyond?

Wise plc reiterated its full-year guidance of underlying income growth between 15 and 20 percent on a constant currency basis. The company also expects to deliver a full-year underlying profit before tax margin of approximately 16 percent, excluding the £35 million in costs related to the US dual-listing project. This margin is at the upper end of its medium-term guidance range of 13 to 16 percent.

Leadership remains confident that the continued investments in product development, compliance, and infrastructure will generate improved speed, lower unit cost, and greater customer satisfaction. Wise plc’s long-term vision remains focused on building the infrastructure to move trillions rather than billions, while its business model increasingly reflects platform thinking—powering not just individual consumers but also financial institutions and enterprises globally.

The share repurchase program, aimed at offsetting employee share award dilution, is already halfway complete. Management plans to finalize the repurchase of 25 million shares by the end of fiscal year 2026 and will provide further updates on capital allocation at the year-end.

While the stock may be under pressure in the short term, institutional sentiment is mixed but not uniformly negative. Many investors remain optimistic about Wise plc’s structural growth potential, especially in platform partnerships and regulated markets. The challenge for management will be to show that pricing flexibility and rising costs today can translate into durable, compounding returns tomorrow.

What are the most important takeaways from Wise plc’s H1 FY26 results and investor response?

• Wise plc reported revenue of £658 million in H1 FY26, reflecting an 11 percent year-on-year increase, with underlying income rising 13 percent to £749.5 million.
• The company’s active customer base grew 18 percent to 13.4 million, while cross-border payment volumes expanded 24 percent to £84.9 billion.
• Profit before tax dropped 13 percent to £254.6 million due to a lower interest income environment and reinvestments into platform growth, infrastructure, and dual-listing expenses.
• Underlying profit before tax margin fell from 22.2 percent in H1 FY25 to 16.3 percent, driven by a 10 basis point decline in cross-border take rate to 0.52 percent.
• Wise plc’s Wise Platform partnerships with Upwork, UniCredit, Raiffeisen Bank International, and others now contribute around 5 percent of cross-border volume, with ambitions to exceed 50 percent long term.
• Administrative expenses rose 27 percent year-on-year to £465.9 million, with £11.5 million attributed to costs related to the company’s upcoming US dual listing.
• The stock fell 5.58 percent to 897.5 GBX following the results announcement, reflecting investor concerns about margin pressure and rising costs despite strong operational growth.
• The company reaffirmed full-year guidance of 15–20 percent underlying income growth on a constant currency basis and a 16 percent underlying profit before tax margin (excluding dual-listing costs).
• Total customer holdings reached £25.3 billion, including £5.6 billion in Wise Assets, while card-related revenue grew 28 percent year-on-year to £132 million.
• Wise plc remains on track for a Q2 FY26 US stock market listing, which management expects will improve access to deeper capital markets and expand global investor participation.