To the casual observer, earnings season may be all about the consumer — how they’re spending, what they’re buying and whether they’re using credit or debit.
However, depending on where you look, the earnings calls and company filings you parse, there are insights illuminating the seismic shifts underway in B2B, too.
To that end, Billtrust Holdings’ and Flywire’s results show that companies across all manner of verticals are moving toward platforms to enhance their payments functionalities and embrace card payments.
For Billtrust, software and payments segments’ revenue growth, on an adjusted basis, was more than 16% year over year. Total Payment Volume, the dollar value of customer payment transactions that Billtrust processes on its platform during a particular period, increased by 45% year-over-year to $22 billion.
The company noted in its results for its first quarter that ended March 31, that direct card revenue was $4.9 million, up markedly from the $2.9 million seen in the same period last year, as card payments gained traction on the company’s electronic payments processing platforms.
And the company’s Business Payments Network growth showed TPV gains of 86% year over year.
As further evidence of the penetration of cards in the B2B realm, the company’s supplemental materials showed that card payments grew to $7.7 billion, from $5.4 billion last year.
Travel a Key Growth Area
During the conference call with analysts, Mike Massaro, chief executive officer of Flywire, said that the total payment volume for the quarter increased 46% compared to Q1 2021.
“As for our B2B vertical, we continue to see success as so many businesses are in need of a solution like ours to automate their accounts receivable,” he said during the call. The company said in its supplementals that it has more than 420 travel and B2B clients.
Rob Orgel, president and COO, noted that the company’s total client count came in at 2,700 at the end of the quarter ending March 31, with 130 new clients. Tailwinds came from increased demand in travel, helping those enterprise clients handle their own increased demand from end customers.
“During Q1 2022, we generated more revenue from our travel clients than we did from all of 2019 or 2020,” he said. Health care remains a strong vertical, too, he said.
Orgel said that 70% of respondents in Flywire’s research say they lose between 4% and 10% of revenue in an average month due to time wasted because of operational inefficiencies with payment processing.
“These are the exact issues our solutions are designed to solve for our B2B clients,” he said.
Chief Financial Officer Mike Ellis gave a nod to the seasonality of the education business and payment mix: “What happens in the second half of the year and due to the seasonality of our business, you’ll see historically, we’ve had really strong cross-border education business that really hit in Q3 and Q4. And what that means is that you have higher average payment sizes, which typically get paid via a bank transfer versus a credit card payment. And really, what you saw in Q1 and what we expect for Q2 is similar credit card utilization payment method mix.”
