UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~June~~September 30, 2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Payoneer Global Inc.

(Exact name of registrant as specified in its charter)

Delaware	001-40547	86-1778671
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification Number)
	150 W 30th St New York, New York, 10001
	(Address of principal executive offices, including zip code)

	(212) 600-9272
Registrant’s Telephone Number, Including Area Code
N/A
(Former name or former address, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	PAYO	The Nasdaq Stock Market LLC
Warrants, each exercisable for one share of common stock, $0.01 par value, at an exercise price of $11.50 per share	PAYOW	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☒	Accelerated filer ☐
Non-accelerated filer ☐	Smaller reporting company ☐
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

As of ~~August~~November 1, 2023, the registrant had ~~359,171,394~~361,808,469 shares of common stock outstanding.

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Payoneer Global Inc.

Form 10-Q

For the Period Ended ~~June~~September 30, 2023

Table of Contents


	Page

PART I. FINANCIAL INFORMATION	4

Item 1. Financial Statements (Unaudited)	4
Condensed consolidated balance sheets (Unaudited)	5
Condensed consolidated statements of comprehensive income (loss) (Unaudited)	6
Condensed consolidated statements of changes in shareholders’ equity (Unaudited)	7
Condensed consolidated statements of cash flows (Unaudited)	9
Notes to the condensed consolidated financial statements (Unaudited)	11
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	2224
Item 3. Quantitative and Qualitative Disclosures About Market Risk	2932
Item 4. Controls and Procedures	3032

PART II - OTHER INFORMATION	3133

Item 1. Legal Proceedings	3133
Item 1A. Risk Factors	3133
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	3133
Item 3. Defaults upon Senior Securities	3133
Item 4. Mine Safety Disclosures	3133
Item 5. Other Information	3234
Item 6. Exhibits	3335
Signatures	3436

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CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q, including the information incorporated herein by reference, contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. Forward-looking statements are typically identified by words such as “anticipate,” “appear,” “approximate,” “believe,” “continue,” “could,” “estimate,” “expect,” “foresee,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “seek,” “should,” “would” and other similar words and expressions (or the negative version of such words or expressions) may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking.

The forward-looking statements are based on the current expectations of Payoneer’s management and are inherently subject to uncertainties and changes in circumstances and their potential effects and speak only as of the date of such statement. There can be no assurance that future developments will be those that have been anticipated. These forward-looking statements involve a number of risks, uncertainties or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to: (1) changes in applicable laws or regulations; (2) the possibility that Payoneer may be adversely affected by geopolitical events and conflicts, such as the current conflict between Israel and Hamas, and other economic, business and/or competitive factors; (3) Payoneer’s estimates of its financial performance; (4) the outcome of any known and/or unknown legal or regulatory proceedings; and (5) other factors, described under the heading “Risk Factors” discussed and identified in public filings made with the U.S. Securities and Exchange Commission (the “SEC”) by Payoneer.

Should one or more of these risks or uncertainties materialize or should any of the assumptions made by the management of Payoneer prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements.

All subsequent written and oral forward-looking statements concerning the matters addressed in this Quarterly Report on Form 10-Q and attributable to Payoneer or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this Quarterly Report on Form 10-Q. Except to the extent required by applicable law or regulation, Payoneer undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date of this Current Report on Form 10-Q or to reflect the occurrence of unanticipated events.

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PART I. FINANCIAL INFORMATION

PAYONEER GLOBAL INC.

QUARTERLY REPORT FOR THE PERIOD ENDED ~~June~~SEPTEMBER 30, 2023

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		Page
Condensed consolidated financial statements (unaudited) in thousands of U.S. dollars:
Condensed consolidated balance sheets (Unaudited)		5
Condensed consolidated comprehensive statements of income (loss) (Unaudited)		6
Condensed consolidated statements of changes in shareholders’ equity (Unaudited)		7
Condensed consolidated statements of cash flows (Unaudited)		9
Notes to condensed consolidated financial statements (Unaudited)		11

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PAYONEER GLOBAL INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

U.S. DOLLARS IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA


	June 30,		December 31,		September 30,		December 31,
	2023		2022		2023		2022
Assets:
Current assets:
Cash and cash equivalents	$	581,053	$	543,299	$	590,565	$	543,299
Restricted cash		9,710		2,882		2,872		2,882
Customer funds		5,528,701		5,838,612		5,370,466		5,838,612
Accounts receivable (net of allowance of $246 at June 30, 2023 and December 31, 2022)		11,260		12,878
Capital advance receivables (net of allowance of $4,565 at June 30, 2023 and $5,311 at December 31, 2022)		40,220		37,155
Accounts receivable (net of allowance of $618 at September 30, 2023 and $246 at December 31, 2022)						5,970		12,878
Capital advance receivables (net of allowance of $4,910 at September 30, 2023 and $5,311 at December 31, 2022)						49,156		37,155
Other current assets		37,983		36,278		42,253		36,278
Total current assets		6,208,927		6,471,104		6,061,282		6,471,104
Non-current assets:
Property, equipment and software, net		13,599		14,392		13,733		14,392
Goodwill		19,889		19,889		19,889		19,889
Intangible assets, net		57,919		45,444		70,872		45,444
Restricted cash		6,092		4,848		6,518		4,848
Deferred taxes		14,002		4,169		16,193		4,169
Investment in associated company		—		6,429		—		6,429
Severance pay fund		970		1,095		944		1,095
Operating lease right-of-use assets		12,681		15,260		12,396		15,260
Other assets		9,771		12,021		15,931		12,021
Total assets	$	6,343,850	$	6,594,651	$	6,217,758	$	6,594,651
Liabilities and shareholders’ equity:
Current liabilities:
Trade payables	$	29,170	$	41,566	$	35,587	$	41,566
Outstanding operating balances		5,528,701		5,838,612		5,370,466		5,838,612
Other payables		100,574		97,334		104,759		97,334
Total current liabilities		5,658,445		5,977,512		5,510,812		5,977,512
Non-current liabilities:
Long-term debt from related party (refer to Notes 8 and 17 for further information)		15,639		16,138
Long-term debt from related party (refer to Notes 8 and 18 for further information)						15,801		16,138
Warrant liability		12,580		25,914		20,379		25,914
Other long-term liabilities		31,239		29,831		32,800		29,831
Total liabilities		5,717,903		6,049,395		5,579,792		6,049,395
Commitments and contingencies (Note 11)
Commitments and contingencies (Note 12)

Shareholders’ equity:
Preferred stock, $0.01 par value, 380,000,000 shares authorized; no shares were issued and outstanding at June 30, 2023 and December 31, 2022.		—		—
Common stock, $0.01 par value, 3,800,000,000 and 3,800,000,000 shares authorized; 363,252,231 and 352,842,026 shares issued and 359,051,208 and 352,842,025 shares outstanding at June 30, 2023 and December 31, 2022, respectively.		3,632		3,528
Treasury stock at cost, 4,201,025 and 0 shares as of June 30, 2023 and December 31, 2022, respectively.		(19,725)		—
Preferred stock, $0.01 par value, 380,000,000 shares authorized; no shares were issued and outstanding at September 30, 2023 and December 31, 2022.						—		—
Common stock, $0.01 par value, 3,800,000,000 and 3,800,000,000 shares authorized; 365,953,562 and 352,842,025 shares issued and 359,014,445 and 352,842,025 shares outstanding at September 30, 2023 and December 31, 2022, respectively.						3,659		3,528
Treasury stock at cost, 6,939,117 and 0 shares as of September 30, 2023 and December 31, 2022, respectively.						(34,759)		—
Additional paid-in capital		697,258		650,433		711,459		650,433
Accumulated other comprehensive loss		(176)		(176)		(176)		(176)
Accumulated deficit		(55,042)		(108,529)		(42,217)		(108,529)
Total shareholders’ equity		625,947		545,256		637,966		545,256
Total liabilities and shareholders’ equity	$	6,343,850	$	6,594,651	$	6,217,758	$	6,594,651

The accompanying notes are an integral part of the condensed consolidated financial statements (Unaudited).

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PAYONEER GLOBAL INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED)

U.S. DOLLARS IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA


	Three months ended				Six months ended				Three months ended				Nine months ended
	June 30,				June 30,				September 30,				September 30,
	2023		2022		2023		2022		2023		2022		2023		2022
Revenues	$	206,734	$	148,190	$	398,748	$	285,148	$	208,035	$	158,917	$	606,783	$	444,065

Transaction costs (Exclusive of depreciation and amortization shown separately below and inclusive of $436 and $338 in interest expense and fees associated with related party transactions during the three months ended June 30, 2023 and 2022, and $857 and $658 during the six months ended June 30, 2023 and 2022, respectively; refer to Notes 8 and 17 for further information)		28,497		26,212		55,578		51,787
Transaction costs (Exclusive of depreciation and amortization shown separately below and inclusive of $437 and $384 in interest expense and fees associated with related party transactions during the three months ended September 30, 2023 and 2022, and $1,294 and $942 during the nine months ended September 30, 2023 and 2022, respectively; refer to Notes 8 and 18 for further information)										30,393		27,986		85,971		79,773
Other operating expenses (Exclusive of depreciation and amortization shown separately below)		40,527		35,392		80,622		70,151		40,301		37,744		120,923		107,895
Research and development expenses		27,995		26,607		57,275		52,522		26,950		29,617		84,225		82,139
Sales and marketing expenses		48,402		36,820		96,228		71,289		48,664		41,081		144,892		112,370
General and administrative expenses		22,012		20,192		48,693		38,320		25,112		21,693		73,805		60,013
Depreciation and amortization		5,909		5,171		11,948		9,626		7,116		5,899		19,064		15,525
Total operating expenses		173,342		150,394		350,344		293,695		178,536		164,020		528,880		457,715

Operating income (loss)		33,392		(2,204)		48,404		(8,547)		29,499		(5,103)		77,903		(13,650)

Financial income (expense):
Gain from change in fair value of Warrants		13,586		12,831		13,334		44,027
Gain (loss) from change in fair value of Warrants										(7,799)		(15,095)		5,535		28,932
Other financial income (expense), net		4,318		(4,824)		6,668		(7,519)		1,137		(3,617)		7,805		(11,136)
Financial income, net		17,904		8,007		20,002		36,508
Financial income (expense), net										(6,662)		(18,712)		13,340		17,796

Income before taxes on income and share in gains (losses) of associated company		51,296		5,803		68,406		27,961
Income (loss) before taxes on income and share in gains (losses) of associated company										22,837		(23,815)		91,243		4,146

Taxes on income		5,747		1,374		14,919		3,341		10,012		2,635		24,931		5,976

Share in gains (losses) of associated company		-		(7)		-		13		-		(2)		-		11

Net income	$	45,549	$	4,422	$	53,487	$	24,633
Net income (loss)									$	12,825	$	(26,452)	$	66,312	$	(1,819)

Other comprehensive loss, net of tax
Foreign currency translation adjustments		-		(3,248)		-		(2,858)		-		(1,658)		-		(4,516)
Other comprehensive loss, net of tax		-		(3,248)		-		(2,858)		-		(1,658)		-		(4,516)

Comprehensive income	$	45,549	$	1,174	$	53,487	$	21,775
Comprehensive income (loss)									$	12,825	$	(28,110)	$	66,312	$	(6,335)

Per Share Data
Net income per share attributable to common stockholders — Basic earnings per share	$	0.12	$	0.01	$	0.15	$	0.07
— Diluted earnings per share	$	0.12	$	0.01	$	0.14	$	0.07
Net income (loss) per share attributable to common stockholders — Basic earnings (loss) per share									$	0.04	$	(0.08)	$	0.18	$	(0.01)
— Diluted earnings (loss) per share									$	0.03	$	(0.08)	$	0.17	$	(0.01)

Weighted average common shares outstanding — Basic		365,000,974		345,522,076		364,260,883		345,831,177		357,429,113		349,740,787		361,206,439		345,359,986
Weighted average common shares outstanding — Diluted		387,623,679		366,013,696		392,572,475		369,047,627		381,845,099		349,740,787		389,658,789		345,359,986

The accompanying notes are an integral part of the condensed consolidated financial statements (Unaudited).

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PAYONEER GLOBAL INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (UNAUDITED)

U.S. DOLLARS IN THOUSANDS, EXCEPT SHARE DATA


									Accumulated														Accumulated
							Additional		other												Additional		other
	Common Stock			Treasury Stock			paid-in		comprehensive		Accumulated				Common Stock			Treasury Stock			paid-in		comprehensive		Accumulated
	Shares	Amount		Shares	Amount		capital		income (loss)		deficit		Total		Shares	Amount		Shares	Amount		capital		loss		deficit		Total
Balance at March 31, 2023	359,202,123	$	3,592	—	$	—	$	674,021	$	(176)	$	(100,591)	$	576,846
Exercise of options and vested RSUs	3,017,674		30	—		—		2,170		—		—		2,200
Balance at June 30, 2023															363,252,231	$	3,632	(4,201,025)	$	(19,725)	$	697,258	$	(176)	$	(55,042)	$	625,947
Exercise of options and vested RSUs, net of taxes paid related to settlement of equity awards															2,701,331		27	—		—		(1,959)		—		—		(1,932)
Stock-based compensation	—		—	—		—		17,051		—		—		17,051	—		—	—		—		16,160		—		—		16,160
ESPP shares issued	1,032,434		10	—		—		4,016		—		—		4,026
Common stock repurchased	—		—	(4,201,025)		(19,725)		—		—		—		(19,725)	—		—	(2,738,092)		(15,034)		—		—		—		(15,034)
Net income	—		—	—		—		—		—		45,549		45,549	—		—	—		—		—		—		12,825		12,825
Balance at June 30, 2023	363,252,231	$	3,632	(4,201,025)	$	(19,725)	$	697,258	$	(176)	$	(55,042)	$	625,947
Balance at September 30, 2023															365,953,562	$	3,659	(6,939,117)	$	(34,759)	$	711,459	$	(176)	$	(42,217)	$	637,966

Balance at March 31, 2022	342,596,367	$	3,426	—	$	—	$	592,243	$	2,643	$	(76,348)	$	521,964
Balance at June 30, 2022															346,439,294	$	3,464	—	$	—	$	611,997	$	(605)	$	(71,926)	$	542,930
Exercise of options and vested RSUs	3,842,927		38	—		—		7,593		—		—		7,631	3,754,393		38	—		—		3,935		—		—		3,973
Stock-based compensation	—		—	—		—		12,161		—		—		12,161	—		—	—		—		13,855		—		—		13,855
Other comprehensive loss, net of tax	—		—	—		—		—		(3,248)		—		(3,248)	—		—	—		—		—		(1,658)		—		(1,658)
Net income	—		—	—		—		—		—		4,422		4,422
Balance at June 30, 2022	346,439,294	$	3,464	—	$	—	$	611,997	$	(605)	$	(71,926)	$	542,930
Net loss															—		—	—		—		—		—		(26,452)		(26,452)
Balance at September 30, 2022															350,193,687	$	3,502	—	$	—	$	629,787	$	(2,263)	$	(98,378)	$	532,648

The accompanying notes are an integral part of the condensed consolidated financial statements (Unaudited).

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PAYONEER GLOBAL INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (UNAUDITED)

U.S. DOLLARS IN THOUSANDS, EXCEPT SHARE DATA

Accumulated




Additional

other

Common Stock

Treasury Stock

paid-in

comprehensive

Accumulated


Shares

Amount

Shares

Amount

capital

income (loss)

deficit

Total
Balance at December 31, 2022

352,842,025

$
3,528

—

$
—

$
650,433

$
(176)

$
(108,529)

$
545,256
Exercise of options, vested RSUs, and shares granted

9,377,772

94

—

—

8,358

—

—

8,452
Stock-based compensation

—

—

—

—

34,451

—

—

34,451
ESPP shares issued

1,032,434

10

4,016

—

—

4,026
Common stock repurchased

—

—

(4,201,025)

(19,725)

—

—

—

(19,725)
Net income

—

—

—

—

—

—

53,487

53,487
Balance at June 30, 2023

363,252,231

$
3,632

(4,201,025)

$
(19,725)

$
697,258

$
(176)

$
(55,042)

$
625,947

Balance at December 31, 2021

340,384,157

$
3,404

—

$
—

$
575,470

$
2,253

$
(94,054)

$
487,073
Adoption of ASC 326

—

—

—

—

—

—

(2,505)

(2,505)
Exercise of options and vested RSUs

6,055,137

60

—

—

11,252

—

—

11,312
Stock-based compensation

—

—

—

—

25,275

—

—

25,275
Other comprehensive loss, net of tax

—

—

—

—

—

(2,858)

—

(2,858)
Net income

—

—

—

—

—

—

24,633

24,633
Balance at June 30, 2022

346,439,294

$
3,464

—

$
—

$
611,997

$
(605)

$
(71,926)

$
542,930


									Accumulated
							Additional		other
	Common Stock			Treasury Stock			paid-in		comprehensive		Accumulated
	Shares	Amount		Shares	Amount		capital		income (loss)		deficit		Total
Balance at December 31, 2022	352,842,025	$	3,528	—	$	—	$	650,433	$	(176)	$	(108,529)	$	545,256
Exercise of options, vested RSUs, and shares granted, net of taxes paid related to settlement of equity awards	12,079,103		121	—		—		6,399		—		—		6,520
Stock-based compensation	—		—	—		—		50,611		—		—		50,611
ESPP shares issued	1,032,434		10	—		—		4,016		—		—		4,026
Common stock repurchased	—		—	(6,939,117)		(34,759)		—		—		—		(34,759)
Net income	—		—	—		—		—		—		66,312		66,312
Balance at September 30, 2023	365,953,562	$	3,659	(6,939,117)	$	(34,759)	$	711,459	$	(176)	$	(42,217)	$	637,966

Balance at December 31, 2021	340,384,157	$	3,404	—	$	—	$	575,470	$	2,253	$	(94,054)	$	487,073
Adoption of ASC 326	—		—	—		—		—		—		(2,505)		(2,505)
Exercise of options and vested RSUs	9,809,530		98	—		—		15,185		—		—		15,283
Stock-based compensation	—		—	—		—		39,132		—		—		39,132
Other comprehensive loss, net of tax	—		—	—		—		—		(4,516)		—		(4,516)
Net loss	—		—	—		—		—		—		(1,819)		(1,819)
Balance at September 30, 2022	350,193,687	$	3,502	—	$	—	$	629,787	$	(2,263)	$	(98,378)	$	532,648

The accompanying notes are an integral part of the condensed consolidated financial statements (Unaudited).

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PAYONEER GLOBAL INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

U.S. DOLLARS IN THOUSANDS

Six months ended

June 30,

2023

2022
Cash Flows from Operating Activities




Net income

$
53,487

$
24,633
Adjustment to reconcile net income to net cash provided by operating activities:


Depreciation and amortization

11,948

9,626
Deferred taxes

(9,833)

1,066
Stock-based compensation expenses

33,100

25,275
Share in gains of associated company

—

(13)
Gain from change in fair value of Warrants

(13,334)

(44,027)
Foreign currency re-measurement loss (gain)

(606)

2,491
Changes in operating assets and liabilities:

Other current assets

(1,621)

(6,650)
Trade payables

(13,157)

9,538
Deferred revenue

407

24
Accounts receivable, net

1,618

(490)
Capital advance extended to customers

(138,900)

(109,422)
Capital advance collected from customers

135,835

121,990
Other payables

(5,259)

(6,318)
Other long-term liabilities

(1,066)

(3,695)
Operating lease right-of-use assets

5,053

5,134
Other assets

2,247

(288)
Net cash provided by operating activities

59,919

28,874

Cash Flows from Investing Activities




Purchase of property, equipment and software

(2,422)

(5,093)
Capitalization of internal use software

(12,921)

(7,772)
Severance pay fund distributions, net

125

481
Customer funds in transit, net

(54,188)

(22,139)
Net cash inflow from acquisition of remaining interest in joint venture (Refer to Note 2(c) for further information)

5,953

—
Net cash used in investing activities

(63,453)

(34,523)

Cash Flows from Financing Activities




Proceeds from issuance of common stock in connection with stock-based compensation plan

12,091

11,312
Outstanding operating balances, net

(309,911)

739,388
Borrowings under related party facility (Refer to Notes 8 and 17 for further information)

14,015

15,322
Repayments under related party facility (Refer to Notes 8 and 17 for further information)

(14,514)

(14,219)
Common stock repurchased

(17,125)

—
Net cash provided by (used in) financing activities

(315,444)

751,803

Effect of exchange rate changes on cash and cash equivalents

705

(2,491)

Net change in cash, cash equivalents, restricted cash and customer funds

(318,273)

743,663
Cash, cash equivalents, restricted cash and customer funds at beginning of period

6,386,720

4,838,433
Cash, cash equivalents, restricted cash and customer funds at end of period

$
6,068,447

$
5,582,096
Supplemental information of investing and financing activities not involving cash flows:


Property, equipment, and software acquired but not paid

$
870

$
551
Internal use software capitalized but not paid

$
8,294

$
1,762
Common stock repurchased but not paid

$
2,600

$
—
Right of use assets obtained in exchange for new operating lease liabilities

$
2,474

$
11,266


	Nine months ended
	September 30,
	2023		2022
Cash Flows from Operating Activities
Net income (loss)	$	66,312	$	(1,819)
Adjustment to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		19,064		15,525
Deferred taxes		(12,024)		820
Stock-based compensation expenses		48,429		39,132
Share in gains of associated company		—		(11)
Gain from change in fair value of Warrants		(5,535)		(28,932)
Foreign currency re-measurement loss		761		3,015
Changes in operating assets and liabilities:
Other current assets		(5,891)		(10,825)
Trade payables		(6,948)		8,753
Deferred revenue		1,206		(30)
Accounts receivable, net		6,908		(7,024)
Capital advance extended to customers		(207,075)		(145,424)
Capital advance collected from customers		195,074		163,266
Other payables		(880)		7,047
Other long-term liabilities		(1,429)		(7,250)
Operating lease right-of-use assets		7,262		7,862
Other assets		(3,906)		221
Net cash provided by operating activities		101,328		44,326

Cash Flows from Investing Activities
Purchase of property, equipment and software		(4,336)		(7,132)
Capitalization of internal use software		(25,322)		(10,209)
Related party asset acquisition (Refer to Notes 6 and 18 for further information)		(3,600)		—
Severance pay fund distributions, net		151		504
Customer funds in transit, net		(20,600)		2,895
Net cash inflow from acquisition of remaining interest in joint venture (Refer to Note 2(c) for further information)		5,953		—
Net cash used in investing activities		(47,754)		(13,942)

Cash Flows from Financing Activities
Proceeds from issuance of common stock in connection with stock-based compensation plan, net of taxes paid related to settlement of equity awards		10,159		15,283
Outstanding operating balances, net		(468,146)		638,370
Borrowings under related party facility (Refer to Notes 8 and 18 for further information)		19,309		22,464
Repayments under related party facility (Refer to Notes 8 and 18 for further information)		(19,646)		(20,382)
Common stock repurchased		(34,408)		—
Net cash provided by (used in) financing activities		(492,732)		655,735

Effect of exchange rate changes on cash and cash equivalents		(662)		(3,369)

Net change in cash, cash equivalents, restricted cash and customer funds		(439,820)		682,750
Cash, cash equivalents, restricted cash and customer funds at beginning of period		6,386,720		4,838,433
Cash, cash equivalents, restricted cash and customer funds at end of period	$	5,946,900	$	5,521,183
Supplemental information of investing and financing activities not involving cash flows:
Property, equipment, and software acquired but not paid	$	1,078	$	338
Internal use software capitalized but not paid	$	12,119	$	2,276
Common stock repurchased but not paid	$	350	$	—
Right of use assets obtained in exchange for new operating lease liabilities	$	4,398	$	13,415

The accompanying notes are an integral part of the condensed consolidated financial statements (Unaudited).

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PAYONEER GLOBAL INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) – (CONTINUED)

U.S. DOLLARS IN THOUSANDS

The below table reconciles cash, cash equivalents, restricted cash and customer funds as reported in the consolidated balance sheets to the total of the same amounts shown in the condensed consolidated statements of cash flows:


	As of June 30,				As of September 30,
	2023		2022		2023		2022
Cash and cash equivalents	$	581,053	$	492,002	$	590,565	$	507,939
Current restricted cash		9,710		3,102		2,872		3,172
Non-current restricted cash		6,092		5,349		6,518		4,413
Customer funds⁽¹⁾		5,471,592		5,081,643		5,346,945		5,005,659
Total cash, cash equivalents, restricted cash and customer funds shown in the condensed consolidated statements of cash flows	$	6,068,447	$	5,582,096	$	5,946,900	$	5,521,183

⁽¹⁾Excludes ~~$57,109~~$23,521 and ~~$58,999~~$33,965 of customer funds in transit as of ~~June~~September 30, 2023 and 2022, respectively.

The accompanying notes are an integral part of the condensed consolidated financial statements (Unaudited).

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PAYONEER GLOBAL INC.

NOTE 1 – GENERAL OVERVIEW

Unless otherwise noted herein, “we”, “us”, “our”, “Payoneer”, and the “Company” refer to Payoneer Global Inc.

Payoneer, incorporated in Delaware, empowers global commerce by connecting businesses, professionals, countries and currencies with its diversified cross-border payments platform. Payoneer enables small and medium-sized businesses (“SMB(s)”) around the globe to reach new audiences by reducing the complexity of cross-border trade, and facilitating seamless, cross-border payments. Payoneer offers its customers the flexibility to pay and get paid globally as easily as they do locally. The Company offers a suite of services that includes cross-border payments, physical and virtual Mastercard cards, working capital, risk management and other services. The fully-hosted service includes various payment options with minimal integration required, full back-office functions and customer support offered.

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES

a. Principles of consolidation, basis of presentation and accounting principles:

The accompanying condensed consolidated financial statements are prepared in accordance with Generally Accepted Accounting Principles (“GAAP”) in the United States of America (hereafter – U.S. GAAP) and include the accounts of Payoneer Global Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Investments in an entity where ~~we have~~the Company has the ability to exercise significant influence, but not control, over the investee are accounted for using the equity method of accounting. For such investments, ~~our~~the Company’s share of the investee’s results of operations is shown within Share in gains and losses of associated company on ~~our~~the condensed consolidated statements of comprehensive income (loss) and ~~our~~its investment balance as an investment in associated company on ~~our~~the condensed consolidated balance sheets.

The consolidated interim financial information herein is unaudited; however, such information reflects all adjustments (consisting of normal, recurring adjustments), which are, in the opinion of management, necessary for a fair statement of results for the interim period. The results of operations for the three and ~~six~~nine months ended ~~June~~September 30, 2023 are not necessarily indicative of the results to be expected for the full year. The year-end condensed balance sheet data was derived from audited financial statements for the year ended December 31, 2022 but does not include all disclosures required by accounting principles generally accepted in the United States of America. These unaudited financial statements should be read in conjunction with the audited consolidated financial statements and related notes thereto of Payoneer Global Inc. and its subsidiaries.

b. Use of estimates in the preparation of financial statements:

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include, but are not limited to, allowance for capital advance receivables, income taxes, goodwill, revenue recognition, stock-based compensation, and loss contingencies.

c. Investment in associated company:

In July 2019, the Company, through its wholly-owned subsidiary Payoneer Research and Development Ltd., entered into an agreement for the establishment of a joint venture company in the People’s Republic of China (“PRC”). The objective of the joint venture was to apply for a local payment service provider license in accordance with PRC laws. The Company’s share in the Joint Venture was 46%, with the remaining ownership interest held by a local partner. Initial funds in the amount of $6,501 were contributed. The investment in the joint venture was presented as an investment in associated company in the Company’s consolidated balance sheets as the Company did not have control over the joint venture.

In January 2023, the Company, through Payoneer Research and Development Ltd., acquired all remaining interests from other partners in the joint venture. As part of the agreement, the acquiring company assumed responsibility for all expenses and income incurred or earned through the date of acquisition related to the joint venture.

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PAYONEER GLOBAL INC.

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (continued):

As substantially all of the fair value of the gross assets of the joint venture are concentrated in a group of similar assets (cash and cash equivalents and restricted deposits), the Company accounted for the transaction as an asset acquisition. As such, the Company’s basis in the acquired assets is valued at the amount of consideration transferred, as shown below.


Consideration paid
Cash¹	$7,961
Foreign exchange loss on payment¹	(100)
Investment in associated company	6,429
Total	$14,290

Assets acquired
Cash and cash equivalents	$6,957
Short-term restricted deposits	6,957
Prepaid assets	24
Tax receivable	59
Intangible assets	293
Total	$14,290

Net cash inflow related to acquisition
Cash and cash equivalents and restricted deposits acquired	$13,914
Cash paid	(7,961)
Net cash inflow	$5,953

(1)

The underlying assets of the joint venture were previously valued in CNY. Due to a timing difference of payment date and acquisition agreement settlement date, $100 of foreign exchange loss was recognized at the time of payment through other financial income (expense), net on the condensed consolidated statements of comprehensive ~~income.~~income (loss).

The Company acquired $59 in tax receivables which ~~we do~~it does not expect to utilize. As such, these receivables were written-off subsequent to acquisition through general and administrative expenses in the condensed consolidated statements of comprehensive ~~income.~~income (loss).

The Company also acquired $293 in intangible assets which were determined to have no use to the Company post-acquisition. As such, these assets were completely impaired through depreciation and amortization expenses in the condensed consolidated statements of comprehensive ~~income.~~income (loss).

d. Functional currency and translation:

Prior to January 1, 2023, the Company had a foreign subsidiary that used the local currency of the respective country as its functional currency. As of January 1, 2023, this subsidiary has changed its functional currency to be that of the Company, the U.S. dollar, due to a shift in the subsidiary’s primary revenue streams, which are now substantially all from services provided to the Company.

e. Treasury stock:

The Company accounts for repurchases of shares of its common stock as of the trade date, and includes in treasury stock the repurchase price plus any costs associated with the transaction.

When and if treasury stock is reissued, the Company applies the average cost method to determine the value of the reissued shares, and to the extent that ~~we remain~~it remains in an accumulated deficit position, recognizes any related gain or loss in additional paid-in capital. When and if the Company’s accumulated deficit becomes a retained earnings balance, weit will credit gains on reissuances to additional paid-in capital and offset losses against historical gains. Losses in excess of historical gains will be recognized against retained earnings.

Treasury stock is included in authorized and issued shares but excluded from outstanding shares.

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PAYONEER GLOBAL INC.

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (continued):

f. Recently issued accounting pronouncements:

~~FASB~~Financial Accounting Standards ~~issued, but not~~Board (“FASB”) standards adopted ~~as of June 30,~~during 2023

In 2020, the FASB issued amended guidance that provides transitional relief for the accounting impact of reference rate reform. For a limited duration, this guidance provides optional expedients and exceptions for applying GAAP to certain contract modifications, hedging relationships, and other transactions that will be impacted by a reference rate expected to be discontinued due to reference rate reform. ~~The amended~~As of July 1, 2023, the Warehouse Facility (as defined in Note 8 below) replaced LIBOR with the Secured Overnight Financing Rate ("SOFR") plus .26161% as its benchmark rate (see Note 8 for further discussion). Adoption of this new guidance ~~is effective through December 31, 2024. The Company does~~did not ~~expect reference rate reform to~~ have a material impact on the Company’s condensed consolidated financial statements.

NOTE 3 – CAPITAL ADVANCE (“CA”) RECEIVABLES

The Company enters into transactions with pre-qualified sellers in which the Company purchases a designated amount of future receivables for an upfront cash purchase price.

During the ~~six~~nine months ended ~~June~~September 30, 2023 and 2022, the Company has purchased and collected the following principal amounts associated with CAs:


	Six months ended				Nine months ended
	June 30,				September 30,
	2023		2022		2023		2022
Beginning CA receivables, gross	$	42,466	$	56,101	$	42,466	$	56,101
CA extended to customers		139,809		109,713		206,187		146,439
Change in revenue receivables		393		44		487		(129)
CA collected from customers		(134,925)		(122,034)		(191,157)		(163,395)
Charge-offs, net of recoveries		(2,958)		(1,349)		(3,917)		(2,059)
Ending CA receivables, gross	$	44,785	$	42,475	$	54,066	$	36,957
Allowance for CA losses		(4,565)		(3,873)		(4,910)		(3,629)
CA receivables, net	$	40,220	$	38,602	$	49,156	$	33,328

The outstanding gross balance at ~~June~~September 30, 2023 consists of the following current and overdue amounts:

1‑30 days

30‑60

60‑90

Above 90

1‑30 days

30‑60

60‑90

Above 90

Total

Current

overdue

Total

Current

overdue

44,785

41,938

1,635

437

381

394

54,066

50,683

1,627

895

376

485

The outstanding gross balance at December 31, 2022 consists of the following current and overdue amounts:


			1‑30 days	30‑60	60‑90	Above 90
Total		Current	overdue	overdue	overdue	overdue
$	42,466	39,945	986	380	104	1,051

The following are current and overdue balances from above that are segregated into the timing of expected collections at ~~June~~September 30, 2023:

Due in less

Due in 30‑60

Due in 60‑90

Due in more

Due in less

Due in 30‑60

Due in 60‑90

Due in more

Total

Overdue

than 30 days

days

than 90 days

Total

Overdue

than 30 days

days

than 90 days

44,785

2,847

8,198

9,562

16,173

8,005

54,066

3,383

11,014

12,763

19,182

7,724

The following are current and overdue balances from above that are segregated into the timing of expected collections at December 31, 2022:


			Due in less	Due in 30‑60	Due in 60‑90	Due in more
Total		Overdue	than 30 days	days	days	than 90 days
$	42,466	2,521	7,354	12,553	14,427	5,611

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PAYONEER GLOBAL INC.

NOTE 3 – CAPITAL ADVANCE (“CA”) RECEIVABLES (continued):

As of ~~June~~September 30, 2023 and December 31, 2022, the Company applied a range of loss rates to the CA portfolio of 1.59% to 1.86% for the allowance for CA losses.

Below is a rollforward for the allowance for CA losses (“ALCAL”):


	Six months ended				Nine months ended
	June 30,				September 30,
	2023		2022		2023		2022
Beginning balance	$	5,311	$	2,426	$	5,311	$	2,426
Adjustment for adoption of ASC 326		—		2,505		—		2,505
Provisions		2,472		1,293		3,649		1,584
Recoveries		(260)		(1,002)		(133)		(827)
Charge-offs		(2,958)		(1,349)		(3,917)		(2,059)
Ending balance	$	4,565	$	3,873	$	4,910	$	3,629

NOTE 4 - OTHER CURRENT ASSETS

Composition of other current assets, grouped by major classifications, is as follows:


	June 30,		December 31,		September 30,		December 31,
	2023		2022		2023		2022
Prepaid expenses	$	15,690	$	12,155	$	18,657	$	12,155
Income receivable		7,520		11,162		9,852		11,162
Prepaid income taxes		11,849		7,671		10,851		7,671
Other		2,924		5,290		2,893		5,290
Total other current assets	$	37,983	$	36,278	$	42,253	$	36,278

NOTE 5 – PROPERTY, EQUIPMENT AND SOFTWARE

Composition of property, equipment and software, grouped by major classifications, is as follows:


	June 30,		December 31,		September 30,		December 31,
	2023		2022		2023		2022
Computers, software and peripheral equipment	$	37,238	$	34,328	$	36,562	$	34,328
Leasehold improvements		9,814		9,741		9,911		9,741
Furniture and office equipment		4,562		4,418		4,679		4,418
Property, equipment and software		51,614		48,487		51,152		48,487
Accumulated depreciation		(38,015)		(34,095)		(37,419)		(34,095)
Property, equipment and software, net	$	13,599	$	14,392	$	13,733	$	14,392

Depreciation expense for the three months ended ~~June~~September 30, 2023 and 2022 was ~~$1,864~~$1,984 and ~~$2,155,~~$2,082, respectively, and ~~$3,976~~$5,960 and ~~$4,071~~$6,153 for the ~~six~~nine months ended ~~June~~September 30, 2023 and 2022, respectively.

During the three months ended September 30, 2023, the Company retired computers, software, and peripheral equipment with a cost of $2,640 that were fully depreciated. No such retirement was recognized in the three or nine months ended September 30, 2022.

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PAYONEER GLOBAL INC.

NOTE 6 – INTANGIBLE ASSETS

Composition of intangible assets, grouped by major classifications, is as follows:


	June 30, 2023						December 31, 2022						September 30, 2023						December 31, 2022
	Gross Carrying Value		Accumulated Amortization		Net Carrying Value		Gross Carrying Value		Accumulated Amortization		Net Carrying Value		Gross Carrying Value		Accumulated Amortization		Net Carrying Value		Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Internal use software	$	95,168	$	(44,702)	$	50,466	$	75,195	$	(38,607)	$	36,588	$	109,965	$	(49,178)	$	60,787	$	75,195	$	(38,607)	$	36,588
Developed technology		14,769		(7,316)		7,453		14,365		(5,509)		8,856
Acquired developed technology														18,319		(8,234)		10,085		14,365		(5,509)		8,856
Intangible assets, net	$	109,937	$	(52,018)	$	57,919	$	89,560	$	(44,116)	$	45,444	$	128,284	$	(57,412)	$	70,872	$	89,560	$	(44,116)	$	45,444

On August 2, 2023, Payoneer Inc. and Payoneer Research & Development Ltd., wholly owned subsidiaries of the Company, purchased certain assets and intellectual property of Spott Incredibles Technologies Ltd. (“Spott”) for a total consideration of $3.6 million, and committed to $0.4 million of future payments contingent on Spott’s former employees’ continued employment with Payoneer Research & Development Ltd. Spott’s intellectual property provides real-time e-commerce data and analytics for more informed and faster business decision-making. Note that a member of the Board of Directors of the Company has an indirect interest within Spott and serves on its board – refer to Note 18 for related party considerations.

The Company determined that this transaction is an asset acquisition under ASC 805, Business Combinations, as substantially all of the fair value of the gross assets of Spott are concentrated in a group of similar intangible assets. The intangible assets will be amortized over a period of three years.

Amortization expense for the three months ended September 30, 2023 and 2022 was $5,133 and $3,203 respectively, and $12,780 and $8,758 for the nine months ended September 30, 2023 and 2022, respectively.

During the nine months ended September 30, 2023, the Company recognized $293 in impairment of acquired intangibles as described in Note 2(c), as well as an insignificant amount of additional impairment related to other intangible assets. The impairment is presented under Depreciation and amortization expenses on the condensed consolidated statements of comprehensive income (loss). During the three and nine months ended September 30, 2022, the Company recognized impairment of internal use of software in the amount of $614, due to the abandonment of specific projects.

Expected future intangible asset amortization as of September 30, 2023, excluding capitalized internal use software of $21,672 not yet placed in service as of that date, was as follows:


Fiscal years
2023 (Excluding the nine months ended September 30, 2023)	$	7,087
2024		20,991
2025		15,982
2026		5,140
2027 and thereafter		—
Total	$	49,200

1415

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PAYONEER GLOBAL INC.

~~NOTE 6 –INTANGIBLE ASSETS (continued):~~

~~Amortization expense for the three months ended June 30, 2023 and 2022 was $4,045 and $3,016 respectively, and $7,647 and $5,555 for the six months ended June 30, 2023 and 2022, respectively.~~

No ~~impairment~~ ~~was recognized during the three months ended June 30, 2023. During the six months ended June 30, 2023, the Company recognized~~ ~~impairment of internal use of software~~ ~~in the amount of $32, as well as the $293~~ ~~impairment of acquired intangibles~~ described in Note 2(c). The impairment is presented under Depreciation and amortization expenses on our condensed consolidated statements of comprehensive income. No impairment was recognized during the three and six months ended June 30, 2022.

~~Expected future intangible asset amortization as of June 30, 2023, excluding capitalized internal use software of $26,626 not yet placed in service as of that date, was as follows:~~

Fiscal years

2023 (Excluding the six months ended June 30, 2023)

$
7,700
2024

13,449
2025

8,972
2026

1,172
2027 and thereafter

—
Total

$
31,293

NOTE 7 - OTHER PAYABLES

Composition of other payables, grouped by major classifications, is as follows:


	June 30,		December 31,		September 30,		December 31,
	2023		2022		2023		2022
Employee related compensation	$	44,627	$	64,464	$	56,251	$	64,464
Commissions payable		21,824		12,159		23,346		12,159
Accrued expenses		10,466		10,001		9,819		10,001
Lease liability		8,202		8,360		7,731		8,360
Income tax payable		10,977		—		4,704		—
Other		4,478		2,350		2,908		2,350
Total other payables	$	100,574	$	97,334	$	104,759	$	97,334

NOTE 8 – DEBT

On October 28, 2021, Payoneer Early Payments Inc. (“PEPI”), a wholly-owned second tier subsidiary of the Company and its subsidiary (the “Borrower”) entered into a Receivables and Loan Security Agreement (the “Warehouse Facility”) with Viola Credit VI, L.P. (currently known as Viola Credit ALF II, L.P.), Viola Credit Alternative Lending FNX SPV, L.P. (the “Lenders”) and Viola Credit Alternative Lending Management 2018 L.P. (collectively, the “Parties”) for the purpose of external financing of Capital Advance activity. The Company notes that the Lenders are related parties through the Company’s Board of Directors’ chairman’s ownership interest in the Lenders. Refer to Note 1718 for further information regarding related party considerations.

In accordance with the Warehouse Facility agreement, the Lenders will make available to the Company an initial committed amount of $25,000, which may be increased at the request of the Company, and with the consent of the Lenders, in $25,000 increments up to $100,000. The associated borrowings will be secured by the assets of the Borrower, which consist primarily of capital advance receivables as well as a pledge of the equity of the Borrower. The recourse under the Warehouse Facility agreement is limited to Borrower's assets, and no other Payoneer entity guarantees repayment by the Borrower.

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~~PAYONEER GLOBAL INC.~~

~~NOTE 8 – DEBT (continued):~~

The Warehouse Facility agreement stipulates a borrowing base calculated at an advance rate of 80% out of the eligible portfolio outstanding receivables ~~balance~~balance.

As of July 1, 2023, the Warehouse Facility bears interest at the sum of the Daily Simple SOFR and ~~that borrowings under the facility bear interest as follows: greater of 0.25% or LIBOR~~0.26161% plus:

●

9.00% per annum if the commitment amount is $25,000;

●

7.75% per annum if the commitment amount is $50,000;

●

7.50% per annum if the commitment amount is $75,000;

●

7.00% per annum if the commitment amount is $100,000.

Prior to July 1, 2023, interest on the facility was calculated as the greater of 0.25% or LIBOR plus the additional percentage amounts per annum based on commitment amount noted above.

On June 8, 2022, the Warehouse Facility agreement was amended to create a condition that the total interest rate, calculated as the sum per above, shall not exceed 10.5% per annum for all outstanding balances.

The revolving period of the facility is 36 months from the closing date and the maturity date is 42 months from the date the Warehouse Facility agreement was entered into.

The Company recorded expenses, included in transaction ~~cost,~~costs, in the total amount of ~~$436~~$437 and ~~$338~~$384 for the three months ended ~~June~~September 30, 2023 and 2022, respectively, and ~~$857~~$1,294 and ~~$658~~$942 for the ~~six~~nine months ended ~~June~~September 30, 2023 and 2022, respectively. As of ~~June~~September 30, 2023, the outstanding associated balance was ~~$15,639~~$15,801 with ~~$142~~$150 of accrued expenses included in Other payables. As of December 31, 2022, the outstanding associated balance was $16,138 with $153 of accrued expenses included in Other payables.

The Warehouse Facility agreement includes certain affirmative and negative covenants that must be maintained by the Company and includes certain financial measures such as minimum tangible equity and minimum unrestricted cash at the Company level. As of ~~June~~September 30, 2023 and December 31, 2022, the Company was in compliance with all applicable covenants.

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PAYONEER GLOBAL INC.

NOTE 8 – DEBT (continued):

As of ~~June~~September 30, 2023 and December 31, 2022, the fair value of the debt approximates the book value due to the short time span between initiation and balance sheet date with the outstanding balance classified as Level 3 in the fair value leveling hierarchy as the inputs into the valuation are not observable.

NOTE 9 – OTHER LONG-TERM LIABILITIES

Composition of other long-term liabilities, grouped by major classifications, is as follows:


	June 30,		December 31,		September 30,		December 31,
	2023		2022		2023		2022
Reserves for uncertain tax positions	$	25,284	$	21,048	$	26,006	$	21,048
Long-term lease liabilities		3,821		6,514		4,025		6,514
Severance pay liabilities		2,116		2,252		2,751		2,252
Other		18		17		18		17
Total other long-term liabilities	$	31,239	$	29,831	$	32,800	$	29,831

NOTE 10 – RESTRUCTURING CHARGES

During the third quarter of 2023, the Company initiated a plan to reduce its workforce by approximately 9% (the “Plan”). The Plan is intended to enhance productivity and efficiency and streamline the Company’s organizational structure to better align operations with its growth objectives.

During the three and nine months ended September 30, 2023, the Company incurred costs of $4,488 related to severance and other employee termination benefits. The restructuring costs are recognized in the condensed consolidated statements of comprehensive income (loss) as follows:


	Severance and other employee termination benefits
Other operating expenses	$	623
Research and development expenses		1,559
Sales and marketing expenses		2,029
General and administrative expenses		277
Total	$	4,488

The following table is a summary of the changes in the restructuring related liabilities, included within the employee related compensation category of the other payables liability on the condensed consolidated balance sheets, associated with the Plan (in thousands):


Balance as of June 30, 2023	$	—
Restructuring charges accrued		4,488
Payments		(3,614)
Balance as of September 30, 2023	$	874

NOTE 1011 – WARRANTS AND SHAREHOLDERS’ EQUITY

Share Repurchase Program and Treasury Stock

On May 7, 2023, ~~our~~the Company’s Board of Directors authorized a stock repurchase program that provides for the repurchase of up to $80,000 of ~~our~~its common stock over a period of 24 months. The program is intended to offset the impact of dilution from the issuance of new shares as part of employee compensation programs.

Any share repurchases under this stock repurchase program may be made through open market transactions, privately negotiated transactions or other means including in accordance with Rule 10b-18 and/or Rule 10b5-1 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The timing and total amount of repurchases is subject to business and market conditions and the Company’s discretion.

During the six months ended June 30, 2023, we repurchased approximately 4,201,025 shares of our common stock for approximately $19,725 at a weighted average cost of $4.68 per share. As of June 30, 2023, a total of approximately $60,275 ~~remained available for future repurchases of our common stock under the program.~~

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PAYONEER GLOBAL INC.

NOTE 1011 – WARRANTS AND SHAREHOLDERS’ EQUITY (continued):

During the three and nine months ended September 30, 2023, the Company repurchased approximately 2,738,092 and 6,939,117 shares of its common stock for approximately $15,034 and $34,759 at a weighted average cost of $5.47 and $4.99 per share, respectively. As of September 30, 2023, a total of approximately $45,379 remained available for future repurchases of the Company’s common stock under the program.

Warrants

The Company has publicly traded warrants that are exercisable for shares of the Company’s common stock. Warrants may only be exercised for a whole number of shares at an exercise price of $11.50. These warrants expire on June 25, 2026, or earlier, if redeemed. At ~~June~~September 30, 2023, there were 25,158,086 warrants outstanding with a corresponding liability valued at ~~$12,580.~~$20,379. The warrants are considered to be a Level 1 fair value measurement due to the observability of the inputs.

The warrants are accounted for as liabilities in accordance with ASC 815-40, Derivatives and Hedging, and are presented within warrant liabilities on ~~our~~the condensed consolidated balance sheets. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the condensed consolidated statements of comprehensive ~~income.~~income (loss). The following table presents the changes in the fair value of warrant liabilities (Level 1):


	Warrant		Warrant
	Liability		Liability
Fair value as of December 31, 2022	$	25,914	$	25,914
Change in fair value		(13,334)		(5,535)
Fair value as of June 30, 2023	$	12,580
Fair value as of September 30, 2023			$	20,379

Fair value as of December 31, 2021	$	59,877	$	59,877
Change in fair value		(44,027)		(28,932)
Fair value as of June 30, 2022	$	15,850
Fair value as of September 30, 2022			$	30,945

NOTE 1112 – COMMITMENTS AND CONTINGENCIES

The Company’s business is subject to various laws and regulations in the United States and other countries from where the Company operates. Any regulatory action, tax or legal challenge against the Company for noncompliance with any regulatory or legal requirement could result in significant fines, penalties, or other enforcement actions, increased costs of doing business through adverse judgment or settlement, reputational harm, the diversion of significant amounts of management time and operational resources, and could require changes in compliance requirements or impose limits on the Company’s ability to expand its product offerings, or otherwise harm or have a material adverse effect on the Company’s business. From time to time, the Company incurs insignificant fines and penalties in the ordinary course of business.

On September 28, 2021, the National Banking and Securities Commission (CNBV) and the Bank of Mexico revoked the banking license of a banking entity utilized by the Company due to the banking entity not meeting applicable capital requirements. As a result, the Company is unable to withdraw funds from the banking entity. The Company has reserved $2,250 for potential losses related to ~~the inaccessible~~those funds above the recovered amount. The Company applied for and recovered the maximum statutory reimbursement through the deposit insurance provided by Mexican Institute for the Protection of Banking Services (IPAB), totaling $140. The Company has filed a claim in liquidation for the remaining funds; however, the percentage of the deposit that will be recovered in liquidation is not known at this time.

On August 7, 2023, Payoneer (Guangzhou) Commerce Services Co., Ltd. (“Payoneer Guangzhou”), a wholly owned subsidiary of the Company, entered into an agreement with a non-bank payments institution (the “Licenseholder”), that offers pay-out and mobile payments solutions to merchants in the People’s Republic of China and holds a Payment Business License issued by the People’s Bank of China (the “PBoC”).

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PAYONEER GLOBAL INC.

NOTE 12 – COMMITMENTS AND CONTINGENCIES (continued):

Pursuant to the terms of the agreement, Payoneer Guangzhou seeks to purchase the Licenseholder, and placed approximately $4 million in escrow in October 2023, representing a small portion of the agreed upon consideration for the purchase. In the event of termination of the agreement, such escrow amount will be returned to Payoneer Guangzhou, and in the event of a successful transaction, it will be applied to the full purchase price. The closing of the acquisition is subject to customary closing conditions and termination provisions provided for in the agreement, as well as, governmental registrations and approvals, including the approval of the Transaction by the PBoC, and timing is uncertain.

From time to time, the Company is involved in other disputes or regulatory inquiries that arise in the ordinary course of business. These may include suits by its customers alleging, among other things, acting unfairly and/or not in conformity regarding pricing, rules or agreements, improper disclosure of ~~our~~the Company’s prices, rules, or policies or that ~~our~~the Company’s practices, prices, rules, policies, or customer agreements violate applicable law.

In addition to these types of disputes and regulatory inquiries, the operations of the Company are also subject to regulatory and/or legal review and/or challenges that tend to reflect the increasing global regulatory focus to which the industry in which the Company operates is subject and, when taken as a whole with other regulatory and legislative action, such actions could result in the imposition of costly new compliance burdens on the Company and may lead to increased costs and decreased transaction volume and revenue. Any claims or regulatory actions against the Company, whether meritorious or not, could be time consuming, result in costly litigation, settlement payments, damage awards (including statutory damages for certain causes of action in certain jurisdictions), fines, penalties, injunctive relief, or increased costs of doing business through adverse judgment or settlement, require the Company to change ~~our~~its business practices, require significant amounts of management time, result in the diversion of operational resources, or otherwise harm the business.

NOTE 13 – REVENUE

The following table presents revenue recognized from contracts with customers as well as revenue from other sources, which consists of interest income:


	Three months ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022
Revenue recognized at a point in time	$	144,665	$	134,394	$	417,788	$	395,400
Revenue recognized over time		2,954		9,477		23,228		29,267
Revenue from contracts with customers		147,619		143,871		441,016		424,667
Revenue from other sources		60,416		15,046		165,767		19,398
Total revenues	$	208,035	$	158,917	$	606,783	$	444,065

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PAYONEER GLOBAL INC.

NOTE 1213 – REVENUE (continued):

~~The following table presents revenue recognized from contracts with customers as well as revenue from other sources, which consists of interest income:~~

Three months ended June 30,

Six months ended June 30,


2023

2022

2023

2022
Revenue recognized at a point in time

$
141,231

$
135,063

$
273,123

$
261,006
Revenue recognized over time

10,210

9,634

20,274

19,790
Revenue from contracts with customers

151,441

144,697

293,397

280,796
Revenue from other sources

55,293

3,493

105,351

4,352
Total revenues

$
206,734

$
148,190

$
398,748

$
285,148

Based on the information provided to and reviewed by ~~our~~the Company’s Chief Operating Decision Maker (“CODM”), ~~we believe~~the Company believes that the nature, amount, timing, and uncertainty of ~~our~~its revenue and cash flows and how they are affected by economic factors are most appropriately depicted through ~~our~~its primary regional markets. The following table presents ~~our~~the Company’s revenue disaggregated by primary regional market, with revenues being attributed to the country (in the region) in which the billing address of the transacting customer is located, with the exception of global bank transfer revenues, where revenues are disaggregated based on the billing address of the transaction funds source.


	Three months ended				Six months ended				Three months ended				Nine months ended
	June 30,				June 30,				September 30,				September 30,
	2023		2022		2023		2022		2023		2022		2023		2022
Primary regional markets
Greater China¹	$	71,227	$	46,785	$	135,187	$	89,826	$	72,513	$	50,162	$	207,700	$	139,988
Europe²		41,699		31,035		80,320		59,495		42,378		33,019		122,698		92,516
Asia-Pacific²		27,385		20,168		52,766		39,187		29,145		21,570		81,911		60,757
North America³		26,041		20,518		51,577		40,795		22,358		21,843		73,935		62,637
South Asia, Middle East and North Africa²		21,711		16,851		41,656		32,263		22,181		17,809		63,837		50,072
Latin America²		18,671		12,833		37,242		23,582		19,460		14,514		56,702		38,095
Total revenues	$	206,734	$	148,190	$	398,748	$	285,148	$	208,035	$	158,917	$	606,783	$	444,065

(1)Greater China is inclusive of mainland China, Hong Kong, Macao and Taiwan

(2)No single country included in any of these regions generated more than 10% of total revenue

(3)

The United States is ~~our~~the Company’s country of domicile. Of North America revenues, the US represents ~~$24,995~~$21,348 and ~~$18,528~~$20,675 during the three months ended ~~June~~September 30, 2023 and 2022, respectively, and ~~$49,571~~$70,919 and ~~$38,310~~$58,985 during the ~~six~~nine months ended ~~June~~September 30, 2023 and 2022, respectively.

NOTE 1314 - TRANSACTION COSTS

Composition of transaction costs, grouped by major classifications, is as follows:


	Three Months Ended				Six months ended				Three Months Ended				Nine months ended
	June 30,				June 30,				September 30,				September 30,
	2023		2022		2023		2022		2023		2022		2023		2022
Bank and processor fees	$	21,739	$	20,889	$	41,858	$	40,804	$	22,410	$	21,365	$	64,303	$	62,169
Network fees		3,730		3,518		7,997		6,934		4,959		3,160		12,956		10,094
Chargebacks and operational losses		693		781		1,750		1,282		550		1,624		2,300		2,906
Card costs		404		441		872		872		575		526		1,447		1,398
Capital advance costs, net of recoveries		1,857		164		2,969		1,106		1,826		987		4,795		2,093
Other		74		419		132		789		73		324		170		1,113
Total transaction costs	$	28,497	$	26,212	$	55,578	$	51,787	$	30,393	$	27,986	$	85,971	$	79,773

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~~PAYONEER GLOBAL INC.~~

NOTE 1415 – STOCK-BASED COMPENSATION

Stock Options and RSUs

The following table summarizes the options to purchase shares of common stock activity under ~~our~~the Company’s equity incentive plans for the ~~six~~nine months ended ~~June~~September 30, 2023:


		Options
Outstanding at December 31, 2022		34,923,788
Granted		—
Exercised		~~(4,503,919)~~(5,783,739)
Forfeited		~~(462,149)~~(571,598)
Outstanding at ~~June~~September 30, 2023		~~29,957,720~~28,568,451
Exercisable at ~~June~~September 30, 2023		~~26,775,173~~26,144,542

The weighted average exercise price of the options outstanding as of ~~June~~September 30, 2023 was ~~$2.12~~$2.13 per share.

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PAYONEER GLOBAL INC.

NOTE 15 – STOCK-BASED COMPENSATION (continued):

The following table summarizes the RSUs activity under ~~our~~the Company’s equity incentive plans as of ~~June~~September 30, 2023:


		Units
Outstanding December 31, 2022		25,853,581
Granted		~~14,986,204~~16,389,704
Vested		~~(4,809,569)~~(6,231,080)
Withhold to cover shares repurchased		~~(351,960)~~(823,274)
Forfeited		~~(1,315,860)~~(2,847,718)
Outstanding ~~June~~September 30, 2023		~~34,362,396~~32,341,213

In the ~~six~~nine months ended ~~June~~September 30, 2023, the Company granted ~~14,086,204~~15,489,704 RSUs under the Company’s Omnibus Stock Incentive Plan, which are subject to time-vesting and continued service conditions. In the same period, the Company granted an additional 900,000 RSUs under the same Plan, which are subject to time-vesting, ~~and~~ continued service conditions ~~as well as~~and stock performance targets.

~~On May 23,~~In 2023, wethe Company started to withhold common stock shares associated with net share settlements to cover tax withholding obligations upon the vesting of restricted stock units under ~~our~~its employee equity incentive plans in the United States. During the three and ~~six~~nine months ended ~~June~~September 30, 2023, wethe Company withheld ~~351,960~~471,314 and 823,274 shares for ~~$1,504.~~$2,753 and $4,257, respectively. RSU vesting is shown net of this withholding on ~~our~~the condensed consolidated statements of shareholders’ equity and cash flows.

Employee Stock Purchase Plan

As of ~~June~~September 30, 2023, approximately 5,591,191 shares were reserved for future issuance under the Company’s Employee Stock Purchase Plan (“ESPP”). The fair value attributable to the ESPP was ~~$1,688,215~~$1,688 as of May 15, 2023, the beginning of the current offering period, and was measured using the Monte Carlo model. The current offering period is expected to close November 15, 2023.

The expense associated with the ESPP recognized during the three and ~~six~~nine months ended ~~June~~September 30, 2023 was ~~$860,471~~$844 and ~~$1,901,735,~~$2,746, respectively.

The impact on ~~our~~the Company’s results of operations of recording stock-based compensation expense under the Company’s equity incentive plans, including the ESPP, were as follows:


	Three Months Ended				Six months ended				Three Months Ended				Nine months ended
	June 30,				June 30,				September 30,				September 30,
	2023		2022		2023		2022		2023		2022		2023		2022
Other operating expenses	$	3,243	$	2,606	$	6,042	$	5,663	$	3,368	$	2,626	$	9,410	$	8,289
Research and development expenses		3,599		2,387		6,982		4,600		3,053		2,779		10,034		7,380
Sales and marketing expenses		4,574		3,642		10,550		7,407		4,163		3,656		14,712		11,062
General and administrative expenses		4,757		3,255		9,526		7,128		4,746		4,464		14,273		11,592
Total stock-based compensation	$	16,173	$	11,890	$	33,100	$	24,798	$	15,330	$	13,525	$	48,429	$	38,323

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~~PAYONEER GLOBAL INC.~~

~~NOTE 14 – STOCK-BASED COMPENSATION (continued):~~

Note that ~~$878~~$1,040 and ~~$271~~$332 in stock-based compensation awards were capitalized as part of internal-use software during the three months ended ~~June~~September 30, 2023 and 2022, respectively, and ~~$1,740~~$2,780 and ~~$488~~$820 were capitalized during the ~~six~~nine months ended ~~June~~September 30, 2023 and 2022, respectively.

NOTE 1516 - INCOME TAXES

The Company had an effective tax rate of ~~22%~~27.3% for the ~~six~~nine months ended ~~June~~September 30, 2023, compared to an effective tax rate of ~~12%~~144% for the ~~six~~nine months ended ~~June~~September 30, 2022. For the ~~six~~nine months ended ~~June~~September 30, 2023, the difference between the Company’s effective tax rate and the U.S. federal statutory rate of 21% was the result of foreign income taxed at different rates, including the provision for uncertain tax positions, ~~as well as~~ an increase in ~~potential future tax benefits primarily related to~~nondeductible expenses such as share-based compensation, ~~and capitalized research and development,~~ and the release of the valuation allowance on deferred tax assets in the United States.

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PAYONEER GLOBAL INC.

NOTE 16 - INCOME TAXES (continued):

The Company maintains a valuation allowance in jurisdictions where it is more likely than not that all or a portion of a deferred tax asset may not be realized. In determining whether a valuation allowance is warranted, the Company evaluates factors such as prior earnings history, expected future earnings and the reversal of existing taxable temporary differences. During the ~~period~~nine months ended ~~June~~September 30, 2023, the Company recorded a release of $10,553 in respect of the valuation allowance applied on deferred tax assets recorded in the United States.

~~We maintain~~The Company maintains a full valuation allowance on ~~our~~its deferred tax assets in Germany and ~~maintain our~~maintains its previous conclusion that a valuation allowance on deferred tax assets in Israel is not necessary.

NOTE 1617 – NET EARNINGS (LOSS) PER SHARE

The Company’s basic net earnings (loss) per share is calculated by dividing net income (loss) attributable to common shareholders by the weighted-average number of shares of common stock outstanding for the period, without consideration of potentially dilutive securities. The diluted net earnings (loss) per share is calculated by giving effect to all potentially dilutive securities outstanding for the period using the treasury share method or the if-converted method based on the nature of such securities. Diluted net earnings (loss) per share is the same as basic net earnings (loss) per share in periods when the effects of potentially dilutive shares of common shares are anti-dilutive.

Basic and diluted net earnings (loss) per share attributable to common stockholders were calculated as follows:


	Three Months Ended				Six months ended				Three Months Ended				Nine months ended
	June 30,				June 30,				September 30,				September 30,
	2023		2022		2023		2022		2023		2022		2023		2022

	(In thousands, except share and per share data)								(In thousands, except share and per share data)
Numerator:
Net income	$	45,549	$	4,422	$	53,487	$	24,633
Net income (loss)									$	12,825	$	(26,452)	$	66,312	$	(1,819)
Denominator:
Weighted average common shares outstanding —
Basic		365,000,974		345,522,076		364,260,883		345,831,177		357,429,113		349,740,787		361,206,439		345,359,986
Add:
Dilutive impact of RSUs, ESPP and options to purchase common stock		21,928,779		19,844,013		27,584,186		22,541,797		23,678,424		—		27,721,456		—
Dilutive impact of private Warrants		693,926		647,607		727,406		674,653		737,562		—		730,894		—
Weighted average common shares – diluted		387,623,679		366,013,696		392,572,475		369,047,627		381,845,099		349,740,787		389,658,789		345,359,986
Net income per share attributable to common stockholders — Basic earnings per share	$	0.12	$	0.01	$	0.15	$	0.07
Diluted earnings per share	$	0.12	$	0.01	$	0.14	$	0.07
Net income (loss) per share attributable to common stockholders — Basic earnings (loss) per share									$	0.04	$	(0.08)	$	0.18	$	(0.01)
Diluted earnings (loss) per share									$	0.03	$	(0.08)	$	0.17	$	(0.01)

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~~PAYONEER GLOBAL INC.~~

~~NOTE 16 – NET EARNINGS PER SHARE (continued):~~

Note that ~~25,158,125~~25,158,086 Public Warrants, ~~1,500,000~~4,570,000 RSUs with market conditions, 30,000,000 Earn-Out Shares (as that term is defined in the Agreement and Plan of Reorganization dated February 3, 2021 (as amended) with FTAC Olympus Acquisition Corp.), ~~726,620~~705,470 options to purchase common stock, and ESPP shares to be issued under the May 15, 2023 offering period have been excluded from the computation of diluted net earnings per share for the three and ~~six~~nine month periods ended ~~June~~September 30, 2023 as their effect was antidilutive, conditions were not met or they were not in the money as of the end of the reporting period. In the three and nine months ended ~~June~~September 30, 2022, ~~25,158,125~~25,158,086 Public Warrants, ~~and~~ 30,000,000 Earn-Out Shares, 30,228,328 and 31,006,169 options to purchase common stock, and 747,744 and 702,556 Private Warrants, respectively, were excluded for the same reason.

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PAYONEER GLOBAL INC.

NOTE 1718 – RELATED PARTY TRANSACTIONS

Warehouse Facility

As indicated in Note 8, the Company entered into a Warehouse Facility agreement with Lenders where a member of the Board of Directors has an interest. The Company has evaluated the relationship and determined that the Warehouse Facility agreement represents a related party transaction that has been entered into in the ordinary course of business. As such, the Warehouse Facility agreement was reviewed and approved as a related party transaction in accordance with the related party transaction approval process implemented by the Company.

The Company analyzed the terms of the Warehouse Facility agreement and concluded that the terms represent a transaction conducted at arm’s length.

Spott Incredibles Technologies Ltd. Asset Acquisition

As discussed in Note 6, On August 2, 2023, Payoneer Inc. and Payoneer Research & Development Ltd., wholly owned subsidiaries of the Company, purchased certain assets and intellectual property of Spott Incredibles Technologies Ltd. A member of the Board of Directors of the Company has an indirect interest within Spott and serves on its board. The Company evaluated the relationship and determined that the acquisition represents a related party transaction that has been entered into in the ordinary course of business. As such, the acquisition was reviewed and approved in accordance with the Company’s related party transaction approval process, and it was concluded that the terms represent a transaction conducted at arm’s length.

NOTE 1819 – SUBSEQUENT EVENTS

~~On July 10,~~In October 2023, in response to Hamas’ attack on Israel from the Gaza Strip, Israel declared war on Hamas. Despite the ongoing war, the Company ~~announced~~has continued to operate its business and serve its customers around the world and, to date, its ability to support customers has not been materially impacted. The Company is monitoring the situation closely and benefits from its broad geographic footprint, partially outsourced operations model, and a ~~plan to reduce its workforce by approximately~~ 9%robust business continuity plan. Additionally, the Company’s technology infrastructure has redundancy in place outside of Israel. Approximately 50% of the Company’s ~~current total headcount (the “Plan”). The Company expects that the implementation~~global employee base is located in Israel, including approximately 81% of the ~~Plan will be substantially completed by the end~~Company’s research and development resources. At this time, less than 10% of the ~~third quarter of 2023. The Plan is expected~~Company’s Israeli workforce have been called to ~~enhance productivity~~military reserve duty and efficiency and streamline the Company’s organizational structure to better align operations with its growth objectives. The Company intends to reinvest some savings from the Plan into future growth initiatives, and to continue hiring for roles essential to those initiatives in areas such as research and development. Decisions regarding the elimination of positions are subject to local law in the various jurisdictions in which the Company ~~employs its teams.~~has contingencies in place to cover impacted roles and responsibilities.

The ~~Company estimates that it will incur charges of approximately $5 million in connection with the Plan, which are expected~~evolving conflict is likely to ~~be incurred~~impact economic activity in the ~~third quarter of 2023. These expected costs are primarily related~~region and could impact revenues from customers located in Israel. The Company’s revenue derived from customers based in Israel was insignificant for the three and nine months ended September 30, 2023, respectively, and is included within revenues from Europe in Note 13 to ~~cash expenditures for severance payments and payroll taxes.~~the condensed consolidated financial statements.

~~On August 2, 2023, Payoneer Inc.~~The situation in the region remains highly uncertain and ~~Payoneer Research & Development Ltd., wholly owned subsidiaries~~there is the possibility that the conflict could 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 the war may have on the Company’s results of operations. Any further escalation, expansion, or prolonged continuation of the ~~Company, purchased certain assets and Intellectual Property (IP) of Spott Incredibles Technologies Ltd. (“Spott”) for a total consideration of $3.6 million~~ongoing conflict has the potential to impact the Company’s operations locally as well as ~~$0.4 million~~the broader global economy and may have a material effect on the Company’s results of future payments contingent on Spott’s former employees continued employment with Payoneer Research & Development Ltd. Spott’s IP provides real-time e-commerce data and analytics for more informed and faster business decision-making.operations.

In addition, a member of the Board of Directors of the Company has an indirect interest within Spott and serves on its board. The Company evaluated the relationship and determined that the acquisition represents a related party transaction that has been entered into in the ordinary course of business. As such, the acquisition was reviewed and approved in accordance with the Company’s related party transaction approval process, and it was concluded that the terms represent a transaction conducted at arm’s length.

On August 7, 2023, Payoneer (Guangzhou) Commerce Services Co., Ltd. (“Payoneer Guangzhou”), a wholly owned subsidiary of the Company, entered into an agreement with a non-bank payments institution, (the “Licenseholder”) that offers pay-out and mobile payments solutions to merchants in the People’s Republic of China and holds a Payment Business License issued by the People’s Bank of China (the “License” and the “PBoC”, respectively).

Pursuant to the terms of the agreement, Payoneer Guangzhou seeks to purchase the Licenseholder, and agreed to place approximately $4 million in escrow within 10 business days of signing the agreement, such escrow representing a small portion of the agreed upon consideration for the purchase. In the event of termination of the agreement, such escrow amount will be returned to Payoneer Guangzhou, and in the event of a successful transaction, it will be applied to the full purchase price. The closing of the acquisition is subject to customary closing conditions and termination provisions provided for in the agreement, as well as, governmental registrations and approvals, including the approval of the Transaction by the PBoC, and timing is uncertain.

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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 includes forward-looking statements that involve risks and uncertainties. You should review the sections titled “Cautionary Note 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 democratizes access to financial services, empowering the world’s small and medium sized businesses to transact, do business and grow globally. With a single connection to Payoneer’s global payment and commerce-enabling platform, our customers can manage their global financial operations and transact globally as easily as they do locally, allowing them to participate in the digital economy and enabling growth for enterprises, marketplaces and SMBs worldwide.

Payoneer was founded in 2005 as technology and the internet were transforming commerce and making it possible for anyone, anywhere to build and grow a digital business. From the beginning, we recognized the importance of offering services to both sides of two-sided commerce networks: small and medium businesses who would need help navigating the increasingly complex digital economy, and marketplaces who would need help supporting their increasingly distributed seller-base. Over the past 18 years, we have built a one-of-a-kind platform designed to serve the needs of digital businesses globally, with a focus on emerging markets.

At the core of the Payoneer platform is a robust, secured, regulated global payment infrastructure that simplifies the process for any business to pay and get paid globally as easily as it does locally. On top of this core, we continue to develop a comprehensive suite of products and services, providing sophisticated tools to help our customers grow.

Leveraging the strength of our payment infrastructure and the breadth of our product offerings, Payoneer operates as both a provider of services to enterprises and marketplaces as well as a B2B payment services provider, empowering all of our customers to transact internationally with ease. As a result, we have cultivated a meaningful brand in the global digital commerce ecosystem supporting millions of marketplaces, enterprises, and SMBs across more than 190 countries and territories and 7,000+ unique trade corridors.

We primarily generate revenues when Payoneer customers use the funds in their Payoneer account to make a payment, make a purchase or to withdraw the funds locally. Our revenue growth is based on (i) growing the volume of transactions processed through the Payoneer platform; and (ii) increasing the monetization rates of Payoneer services. Our efforts to increase the overall monetization rate of Payoneer services includes increasing our focus on acquiring customers in regions with higher rates of monetization, accelerating the growth of payment services with higher rates of monetization like B2B, ~~AP/AR,~~ and also introducing new services for customers that generate improved monetization, like our ~~Payoneer Commercial Mastercard.~~card products. 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 ~~$15.8~~$16.8 billion and ~~$14.6~~$15.1 billion in volume during the three months ended ~~June~~September 30, 2023 and 2022, respectively, and ~~$31.5~~$48.3 billion and ~~$29.3~~$44.4 billion in volume during the ~~six~~nine months ended ~~June~~September 30, 2023 and 2022, 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 more acquisitions to accelerate our ability to deliver more value to customers around the world.

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Key Developments and Trends

2023 Israel – Hamas War

In October 2023, in response to Hamas’ attack on Israel from the Gaza Strip, Israel declared war on Hamas. Despite the ongoing war, we have 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 are monitoring the situation closely and benefits 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 50% of our global employee base is located in Israel, including approximately 81% of our research and development resources. At this time, less than 10% of our Israeli workforce have been called to military reserve duty and we have contingencies in place to cover impacted roles and responsibilities.

The evolving conflict is likely to impact economic activity in the region and could impact revenues from customers located in Israel. Our revenue derived from customers based in Israel was insignificant for the three and nine months ended September 30, 2023, respectively, and is included within revenues from Europe in Note 13 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q

The situation in the region remains highly uncertain and there is the possibility that the conflict could 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 the war may have on our results of operations. Any further escalation, expansion, or prolonged continuation of the ongoing conflict has the potential to impact our operations locally as well as the broader global economy and may have a material effect on our results of operations.

Workforce Reduction Plan

On July 10, 2023, we announced a plan to reduce our workforce by approximately 9% of our then-current total headcount (the “Plan”). The Plan is expected to enhance productivity and efficiency as well as streamline our organizational structure to better align operations with our growth objectives. We intend to reinvest some savings from the Plan into future growth initiatives, and to continue hiring for roles essential to those initiatives in areas such as research and development.

During the three and nine months ended September 30, 2023, we incurred costs of $4.5 million related to severance and other employee termination benefits.

We expect an annualized future benefit to our operating expenses of approximately $20 million in connection with the Plan.

Repurchase Program

During the nine months ended September 30, 2023, we repurchased approximately 6,939,117 shares of our common stock for approximately $34,759 million at a weighted average cost of $4.99 per share under our $80 million repurchase program authorized in May 2023. As of September 30, 2023, a total of approximately $45,379 million remained available for future repurchases of our common stock under the program.

Impact of the war in Ukraine

During 2022, a geopolitical and armed conflict between Ukraine and Russia, which developed into an ongoing war, resulted in economic sanctions on Russia, Belarus, and certain territories in Ukraine. ~~Payoneer provides~~We provide services to customers in Ukraine and in jurisdictions that are or may be impacted by these economic sanctions. We have developed and implemented 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. During 2022, we ceased to provide services to customers in Russia and have ~~been reducing~~limited our payment services to Belarus customers, while at the same time revenues in Ukraine have remained relatively stable. For the three and ~~six~~nine months ended ~~June~~September 30, 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.

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Macroeconomic Conditions

Macroeconomic conditions, such as rising interest rates, inflation, the continued impact of COVID-19, the ongoing war in Ukraine and the evolving Israel-Hamas war, and disruptions in the banking sector, may affect our results of operations. For example, during 2022, and in response to rising inflation, the U.S. Federal Reserve raised the benchmark interest rate by 425 basis points, with an additional 100 basis point increase so far in 2023. This has contributed to an increase in interest income earned on our customer balances. U.S. and global inflation rates have remained elevated and the Federal Reserve, as well as other central banks, have continued to raise interest rates. Higher interest rates positively impact our interest income ~~revenues associated with underlying customer accounts.~~revenues. However, a prolonged period of high interest rates is likely to slow economic growth, and business and consumer ~~spend~~spending globally which may negatively impact the volumes processed on our platform. There remains a great deal of uncertainty related to the ongoing trajectory of U.S. interest rate policy, the likely impact of monetary tightening globally and the degree to which the global economy could be impacted. In addition, while we have commercial arrangements with multiple banks globally, we have not been materially affected by the ~~recent~~ volatility and uncertainty in the banking ~~sector.~~

~~Repurchase Program~~

On May 7, 2023, our Board of Directors authorized a stock repurchase program that provides for the repurchase of up to $80 million of our common stock over a period of 24 months. Any share repurchases undersector experienced earlier this stock repurchase program may be made through open market transactions, privately negotiated transactions or other means including in accordance with Rule 10b-18 and/or Rule 10b5-1 of the Exchange Act. The timing and total amount of repurchases is subject to business and market conditions and the Company’s discretion.year.

~~During the three months ended June 30, 2023, we repurchased approximately~~ 4,201,025 shares of our common stock for approximately $19.7 million at a weighted average cost of $4.68 per share. As of June 30, 2023, a total of approximately $60.3 million remained available for future repurchases of our common stock under the program.

~~Workforce Reduction Plan~~

On July 10, 2023, the Company announced a plan to reduce its workforce by approximately 9% of the Company’s current total headcount (the “Plan”). The Company expects that the implementation of the Plan will be substantially completed by the end of the third quarter of 2023. The Plan is expected to enhance productivity and efficiency and streamline the Company’s organizational structure to better align operations with its growth objectives. The Company intends to reinvest some savings from the Plan into future growth initiatives, and to continue hiring for roles essential to those initiatives in areas such as research and development. Decisions regarding the elimination of positions are subject to local law in the various jurisdictions in which the Company employs its teams.

The Company estimates that it will incur charges of approximately $5 million in connection with the Plan, which are expected to be incurred in the third quarter of 2023. These expected costs are primarily related to cash expenditures for severance payments and payroll taxes.

~~Additionally, the Company expects an annualized future benefit to its operating expenses of approximately $20 million in connection with the Plan.~~

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Results of Operations

The period-to-period comparisons of our results of operations have been prepared using the historical periods in our condensed consolidated financial statements. The following discussion should be read in conjunction with the unaudited condensed consolidated financial statements and related Notes included within this Quarterly Report on Form 10-Q.


	Three months ended						Six months ended						Three months ended						Nine months ended
	June 30,				Increase/		June 30,				Increase/		September 30,				Increase/		September 30,				Increase/
	2023		2022		(Decrease)		2023		2022		(Decrease)		2023		2022		(Decrease)		2023		2022		(Decrease)

	(in thousands except percentages)												(in thousands except percentages)
Revenues	$	206,734	$	148,190	40	%	$	398,748	$	285,148	40	%	$	208,035	$	158,917	31	%	$	606,783	$	444,065	37	%
Transaction costs		28,497		26,212	9	%		55,578		51,787	7	%		30,393		27,986	9	%		85,971		79,773	8	%
Other operating expenses		40,527		35,392	15	%		80,622		70,151	15	%		40,301		37,744	7	%		120,923		107,895	12	%
Research and development expenses		27,995		26,607	5	%		57,275		52,522	9	%		26,950		29,617	(9)	%		84,225		82,139	3	%
Sales and marketing expenses		48,402		36,820	31	%		96,228		71,289	35	%		48,664		41,081	18	%		144,892		112,370	29	%
General and administrative expenses		22,012		20,192	9	%		48,693		38,320	27	%		25,112		21,693	16	%		73,805		60,013	23	%
Depreciation and amortization		5,909		5,171	14	%		11,948		9,626	24	%		7,116		5,899	21	%		19,064		15,525	23	%
Total operating expenses		173,342		150,394	15	%		350,344		293,695	19	%		178,536		164,020	9	%		528,880		457,715	16	%
Operating income (loss)		33,392		(2,204)	**	%		48,404		(8,547)	**	%		29,499		(5,103)	**	%		77,903		(13,650)	**	%
Financial income (expense):
Gain from change in fair value of Warrants		13,586		12,831	6	%		13,334		44,027	**	%
Gain (loss) from change in fair value of Warrants														(7,799)		(15,095)	(48)	%		5,535		28,932	(81)	%
Other financial income (expense), net		4,318		(4,824)	**	%		6,668		(7,519)	**	%		1,137		(3,617)	**	%		7,805		(11,136)	**	%
Financial income, net		17,904		8,007	124	%		20,002		36,508	**	%
Income before taxes on income and share in gains (losses) of associated company		51,296		5,803	**	%		68,406		27,961	145	%
Financial income (expense), net														(6,662)		(18,712)	(64)	%		13,340		17,796	(25)	%
Income (loss) before taxes on income and share in gains (losses) of associated company														22,837		(23,815)	**	%		91,243		4,146	**	%
Taxes on income		5,747		1,374	**	%		14,919		3,341	**	%		10,012		2,635	**	%		24,931		5,976	**	%
Share in gains (losses) of associated company		—		(7)	**	%		—		13	**	%		—		(2)	**	%		—		11	**	%
Net income	$	45,549	$	4,422	**	%	$	53,487	$	24,633	117	%
Net income (loss)													$	12,825	$	(26,452)	**	%	$	66,312	$	(1,819)	**	%

^{**Not meaningful}

Revenues

Revenues were ~~$206.7~~$208.0 million and ~~$398.7~~$606.8 million for the three and ~~six~~nine months ended ~~June~~September 30, 2023, an increase of ~~$58.5~~$49.1 million and ~~$113.6~~$162.7 million, or ~~40% in both periods,~~31% and 37%, compared to the prior-year period, driven mainly by an increase of ~~$51.8~~$45.4 million and $146.4 million in interest income earned on customer balances resulting from rising interest rates and an increase in customer balances held on our ~~platform as well as rising interest rates.~~platform. The remaining increase was driven by a combination of growth in the number of customers on our platform, ongoing growth in ~~several~~ high value regions, certain monetization initiatives and continued adoption of our high value services.

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Transaction costs

Transaction costs were ~~$28.5~~$30.4 million for the three months ended ~~June~~September 30, 2023, an increase of ~~$2.3~~$2.4 million, or 9%, compared to the prior-year period, ~~primarily~~partially due to an increase in capital advance costs of ~~$1.7~~$0.8 million driven by an increase in losses recognized. Excluding ~~this driver,~~the impact of these non-volume related costs, transaction costs increased by ~~$0.6~~$1.6 million or 2%6%, while volume increased by ~~8% as~~11% compared to the ~~prior-year~~prior year period. Transaction costs grew at a lower rate than volume due to improved commercial terms with banking and other providers, internal platform optimizations, and cost structure benefits from increased transaction ~~volumes.~~volume.

Transaction costs were ~~$55.6~~$86.0 million for the ~~six~~nine months ended ~~June~~September 30, 2023, an increase of ~~$3.8~~$6.2 million, or 7%8%, compared to the prior-year period, primarily due to an increase of ~~$1.9~~$2.9 million in card network fees, $2.7 million in capital advance costs ~~$1.1~~and $2.1 million in bank and processor ~~fees, and $1.1 million in network~~ fees.

Other operating expenses

Other operating expenses were ~~$40.5~~$40.3 million for the three months ended ~~June~~September 30, 2023, an increase of ~~$5.1~~$2.6 million, or ~~15%~~7%, compared to the prior-year period, driven by an increase of ~~$3.6~~$3.3 million in third-party contract and consulting expenses ~~$2.2~~and an increase of $1.0 million in information technology expenses, partially offset by a decrease of $1.0 million in employee compensation, benefits and other employee-related expenses ~~mainly as~~in line with a ~~result of an increase~~decrease in employee ~~headcount, and an increase of $1.5 million in information technology expenses.~~headcount.

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Other operating expenses were ~~$80.6~~$120.9 million for the ~~six~~nine months ended ~~June~~September 30, 2023, an increase of ~~$10.5~~$13.0 million, or ~~15%~~12%, compared to the prior-year period, driven by an increase of ~~$6.9~~$10.2 million in third-party contract and consulting expenses, ~~$2.6~~an increase of $3.6 million in information technology expenses, and an increase of $1.7 million in employee compensation, benefits and other employee-related ~~expenses, mainly as a result of an increase in employee headcount, and an increase of $2.6 million in information technology~~ expenses.

Research and development expenses

Research and development expenses were ~~$28.0~~$27.0 million for the three months ended ~~June~~September 30, 2023, a decrease of $2.7 million, or 9%, compared to the prior-year period, driven by an increase in the capitalization of employee compensation costs related to ongoing investments in our platform infrastructure, resulting in an additional $5.0 million in capitalized costs, offset by an increase of $1.7 million in information technology expenses and $1.6 million in costs related to the workforce reduction plan discussed in the key developments and trends section.

Research and development expenses were $84.2 million for the nine months ended September 30, 2023, an increase of ~~$1.4~~$2.1 million, or 5%3%, compared to the prior-year period, driven by an increase of ~~$0.9~~$3.0 million in information technology expenses and ~~$0.6~~$1.6 million in severance related costs related to the workforce reduction plan discussed above, partially offset by a decrease of $2.3 million in employee compensation, benefits and other employee-related expenses ~~mainly~~ as a result of ~~an increase in employee headcount in our research and development groups, which was partially offset by~~ an increase in capitalization due to shifting of resources towards new investments in our platform.

~~Research~~Sales and ~~development~~marketing expenses

Sales and marketing expenses were ~~$57.3~~$48.7 million for the ~~six~~three months ended ~~June~~September 30, 2023, an increase of ~~$4.8~~$7.6 million, or 9%18%, compared to the prior-year period, driven by an increase of ~~$2.8~~$6.1 million in marketplace partner commissions and $2.0 million in costs related to the previously discussed workforce reduction plan. These increases were offset by a decrease of $1.3 million in employee compensation, benefits and other employee-related expenses, mainly as a result of an increase in employee headcount in our research and development groups, which was partially offset by an increase in capitalization due to shifting of resources towards new investments in our platform. Additional increases include $1.3 million in information technology expenses and $0.6 million in third-party contractor expenses.

~~Sales and marketing expenses~~

Sales and marketing expenses were ~~$48.4~~$144.9 million for the ~~three~~nine months ended ~~June~~September 30, 2023, an increase of ~~$11.6~~$32.5 million, or ~~31%~~29%, compared to the prior-year period, driven by an increase of ~~$4.6~~$15.1 million in ~~third-party~~marketplace partner commissions, ~~$3.7~~an increase of $9.2 million in employee compensation, benefits and other employee-related expenses ~~mainly~~ as a result of an increase in average employee headcount in our sales and marketing groups as well as $2.0 million in costs associated with the previously discussed workforce reduction plan, increased spend of $3.1 million on marketing programs, and an increase of ~~$1.3~~$2.9 million in third-party contractor ~~expenses,~~expenses.

General and ~~increased spend of $1.6 million on marketing programs.~~administrative expenses

~~Sales~~General and ~~marketing~~administrative expenses were ~~$96.2~~$25.1 million for the ~~six~~three months ended ~~June~~September 30, 2023, an increase of ~~$24.9~~$3.4 million, or ~~35%~~16%, compared to the prior-year period, driven by an increase of ~~$10.6~~$1.7 million in ~~employee compensation, benefits~~M&A and ~~other employee-related~~legal expenses mainly as a result of an increase in employee headcount in our sales and marketing groups, an increase of $9.0 million in third-party commissions, increased spend of $2.6 million on marketing programs, and an increase of ~~$2.5~~$1.6 million ~~in third-party contractor~~resulting from the fair value adjustment of a liability related to our 2020 acquisition of Optile that positively impacted the prior period and ~~consultant expenses.~~did not recur.

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General and administrative expenses were ~~$22.0~~$73.8 million for the ~~three~~nine months ended ~~June~~September 30, 2023, an increase of ~~$1.8~~$13.8 million, or 9%23%, compared to the prior-year period, driven by an increase of ~~$2.1~~$6.8 million in employee compensation, benefits and other employee-related expenses ~~mainly as a result of an increase in employee headcount.~~

General and administrative expenses were $48.7 million for the six months ended June 30, 2023, an increase of $10.4 million, or 27%, compared to the prior-year period, driven by an increase of $7 million in employee compensation, benefits and other employee-related expenses, mainly as a result of an increase in employee headcount, an increase of $2.8 million in M&A and legal expenses, an increase of $2.3 million due to the fair value adjustment of a liability related to our 2020 acquisition of Optile that positively impacted the prior period and did not recur, and an increase of ~~$1.5~~$1.9 million in taxes and fees.

Depreciation and amortization expenses

Depreciation and amortization expenses were ~~$5.9~~$7.1 million and ~~$11.9~~$19.1 million for the three and ~~six~~nine months ended ~~June~~September 30, 2023, an increase of ~~$0.7~~$1.2 million and ~~$2.3~~$3.5 million, or ~~14%~~21% and ~~24%~~23%, respectively, compared to the prior-year period, mainly driven by an increase in amortization of internal use of software.

Financial income and expense, net

Financial ~~income,~~expense, net was ~~$17.9~~$6.7 million for the three months ended ~~June~~September 30, 2023, an ~~increase~~improvement of ~~$9.9~~$12.1 million, or ~~124%~~64%, compared to the prior-year period, driven by a $7.3 million decrease in the loss from the change in the fair value of warrants, an increase of ~~$5.3 million from revaluation of foreign currency balances, an increase of $3.8~~$3.0 million in interest income on corporate cash balances, and a ~~$0.8~~$1.9 million ~~higher gain related to the change in fair value~~increase derived from revaluation of ~~warrants.~~foreign currency balances.

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Financial income, net was ~~$20.0~~$13.3 million for the ~~six~~nine months ended ~~June~~September 30, 2023, a decrease of ~~$16.5~~$4.5 million, or ~~45%~~25%, compared to the prior-year period, which benefitted from a gain related to the change in fair value of warrants that was ~~$30.7~~$23.4 million higher than in the current period. This was partially offset by an increase of ~~$7.6~~$10.6 million in interest income on corporate cash balances and an increase of ~~$6.1~~$8.9 million from revaluation of foreign currency balances.

Income tax

Income tax expense was ~~$5.7~~$10.0 million and ~~$14.9~~$24.9 million for the three and ~~six~~nine months ended ~~June~~September 30, 2023, an increase of ~~$4.4~~$7.4 million and ~~$11.6~~$19.0 million, or ~~318%~~280% and ~~347%~~317%, respectively, compared to the prior-year ~~period,~~periods, driven by an increase in ~~the Company~~’sour US federal and state income tax ~~liabilities~~expenses of ~~$14.8~~$8.3 million and ~~$19.5~~$17.5 million for the three and ~~six~~nine months ended ~~June~~September 30, 2023, respectively. These increases were ~~primarily~~ driven by increased profitability in the US, ~~including non-deductible permanent~~primarily due to interest income, as well as certain stock compensation and ~~temporary differences. Taxes~~research and development expenses which are nondeductible for US tax purposes. Income tax expense was also impacted by an increase in taxes associated with our foreign subsidiaries of ~~$0.2~~$1.4 million and ~~$2.7~~$3.5 million in the three and ~~six~~nine months ended ~~June~~September 30, 2023, ~~respectively, resulted in an additional increase to current period tax expense.~~respectively. These increases were offset by a US deferred tax benefit ~~from the release~~ of ~~the valuation allowance on deferred tax assets in the United States of $10.6~~$1.2 million and $11.7 million for ~~both~~ the three and ~~six~~nine months ended ~~June~~September 30, ~~2023.~~2023, respectively.

Liquidity and Capital Resources

The following discussion of our liquidity and capital resources is based on the financial information derived from our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.

We believe our existing cash and cash equivalents and cash flows from operating activities will be sufficient to meet our operating working capital, share repurchase and capital expenditure requirements for at least the next twelve months. Our future financing requirements will depend on many factors including our growth rate, the timing and extent of spending to support development of our platform and the ongoing expansion needs of sales and marketing activities. We have in the past and may in the future enter into agreements with third parties with respect to investments in, or acquisitions of, businesses or technologies, which could also require us to seek additional equity or debt financing.

Sources of Liquidity

As of ~~June~~September 30, 2023, we had ~~$581.1~~$590.6 million of cash and cash equivalents.

On October 28, 2021, Payoneer Early Payments Inc. (“PEPI”), aour wholly-owned second tier subsidiary ~~of the Company~~ and its subsidiary (the “Borrower”) entered into a multi-party Receivables Loan and Security Agreement (the “Warehouse Facility”) with, inter alia, affiliates of Viola Ventures. The objective was to provide access to external financing for our capital advance activity. See Note 8 and Note 1718 to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for more information.

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As of July 1, 2023, the Warehouse Facility bears interest at the ~~greater~~sum of ~~0.25% or LIBOR,~~the Daily Simple SOFR and 0.26161% plus 9% annually and has a revolving maturity of 36 months from the commencement date with a payback period of an additional 6 months after the revolving maturity date. The initial borrowing commitment is $25 million but can be increased subject to the lender’s discretion up to $100 million. ~~Additional commitments will carry interest rates ranging from 7.0% to 7.75%.~~ In addition, pursuant to the Warehouse Facility, PEPI entered into an amendment on June 8, 2022, capping the total interest rate at 10.5% per annum for all outstanding balances.

As of June 30, 2023, the LIBOR rate has ceased to be provided by the ICE Benchmark Administration. As such, beginning July 1, 2023, the sum of the Daily Simple SOFR and 0.26161% will be used as an alternative benchmark pursuant to the terms of the Warehouse Facility.

The Warehouse Facility is secured by eligible capital advance receivables at an initial rate of 80% of the total value of the underlying capital advance receivable outstanding. We are subject to financial covenants including minimum tangible equity, solvency and unrestricted cash requirements that are assessed based on our condensed consolidated financial statements.

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~~PAYONEER GLOBAL INC.~~

Current and Future Cash Requirements

On May 7, 2023, our Board of Directors authorized a stock repurchase program that provides for the repurchase of up to $80 million of our common stock over a period of 24 months. During the ~~three~~nine months ended ~~June~~September 30, 2023, we repurchased approximately ~~4,201,025~~6,939,117 shares of our common stock for approximately ~~$19.7~~$34.8 million, of which ~~$2.6~~$0.4 million was not yet ~~paid in cash~~settled at period end. As of ~~June~~September 30, 2023, a total of approximately ~~$60.3~~$45.4 million remained available for future repurchases of our common stock under the program.

Cash Flows

The following table presents a summary of cash flows from operating, investing, and financing activities for the following comparative periods.


	Six months ended June 30,				Nine months ended September 30,
	2023		2022		2023		2022

	(in thousands)				(in thousands)
Net cash provided by operating activities	$	59,919	$	28,874	$	101,328	$	44,326
Net cash used in investing activities		(63,453)		(34,523)		(47,754)		(13,942)
Net cash provided by (used in) financing activities		(315,444)		751,803		(492,732)		655,735
Effect of exchange rate changes on cash and cash equivalents		705		(2,491)		(662)		(3,369)
Change in cash, cash equivalents, restricted cash and customer funds	$	(318,273)	$	743,663	$	(439,820)	$	682,750

Operating Activities

Net cash provided by operating activities was ~~$59.9~~$101.3 million for the ~~six~~nine months ended ~~June~~September 30, 2023, an increase of ~~$31.0~~$57.0 million compared to ~~$28.9~~$44.3 million for the ~~six~~nine months ended ~~June~~September 30, 2022.

For the ~~six~~nine months ended ~~June~~September 30, 2023, ~~the Company~~we had $~~53.5~~66.3 million of net income, which includes non-cash expenses of ~~$33.1~~$48.4 million related to stock-based compensation and ~~$11.9~~$19.1 million related to depreciation and amortization, as well as non-cash ~~gains~~income of ~~$13.3~~$12.0 million related to deferred taxes and a $5.5 million non-cash gain from change in the fair value of ~~warrants and non-cash deferred tax benefit of $9.8 million, primarily related to the release of our valuation allowance in the United States.~~warrant liabilities. Net income was also adjusted for changes in current assets and liabilities, including net outflows of ~~$13.2~~$12.0 million related to capital advances, $6.9 million related to trade payables, ~~$5.3~~$5.9 million related to other ~~payables,~~current assets, and ~~$3.1~~$4.2 million related to ~~capital advances.~~miscellaneous items. These outflows were partially offset by inflows of ~~$5.1~~$7.3 million related to operating lease right-of-use assets and ~~$1.0 million~~$6.9 related to ~~miscellaneous items.~~accounts receivable.

For the ~~six~~nine months ended ~~June~~September 30, 2022, ~~the Company~~we had $~~24.6~~1.8 million of net ~~income,~~loss, which includes non-cash expenses of ~~$25.3~~$39.1 million related to stock-based compensation and ~~$9.6~~$15.5 million related to depreciation and amortization, ~~and~~as well as non-cash gains of ~~$44.0~~$28.9 million related to change in fair value of warrants. Net income was also adjusted for changes in current assets and liabilities, including net inflows of ~~$12.6~~$17.8 million related to capital advances and ~~$9.5~~$2.6 million related to ~~trade payables. Other~~ miscellaneous ~~net outflows amounted to $8.7 million for the period.~~items.

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PAYONEER GLOBAL INC.

Investing Activities

Net cash used in investing activities was ~~$63.5~~$47.8 million for the ~~six~~nine months ended ~~June~~September 30, 2023, a change of ~~$28.9~~$33.8 million compared to net cash used in investing activities of ~~$34.5~~$13.9 million for the ~~six~~nine months ended ~~June~~September 30, 2022.

This change was predominantly related to an increase of ~~$32.0~~$23.5 million in the balance of customer funds in transit inat the current ~~year~~period end compared to the ~~previous~~prior year period and an increase of $15.1 million in capitalization of internal use software, partially offset by a cash inflow of $6.0 million related to our acquisition of the remaining interest in a joint venture, as described in Note 2(c) to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.

Financing Activities

Net cash used in financing activities was ~~$315.4~~$492.7 million for the ~~six~~nine months ended ~~June~~September 30, 2023, a change of ~~$1,067.2 million~~$1.1 billion compared to net cash provided by financing activities of ~~$751.8~~$655.7 million for the ~~six~~nine months ended ~~June~~September 30, 2022. Current period cash used in financing activities primarily reflects a decline in customer balances, while cash provided by financing activities in the prior period reflects an increase in customer balances. Additionally, approximately ~~$17.1~~$34.4 million was used in the current period to finance our share repurchase program which began during the ~~three~~nine months ended ~~June~~September 30, 2023.

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~~PAYONEER GLOBAL INC.~~

Key Metrics and Non-GAAP Financial Measures

Our management uses a variety of financial and operating metrics to evaluate our business, analyze our performance, and make strategic decisions. We believe these metrics and non-GAAP financial measures provide useful information to investors and others in understanding and evaluating our operating results in the same manner as management. However, these measures are not financial measures calculated in accordance with GAAP and should not be considered as substitutes for financial measures that have been calculated in accordance with GAAP. We primarily review the following key performance indicators and non-GAAP measures when assessing our performance:

Volume

Volume refers to the total dollar value of transactions successfully completed or enabled by our platform, not including orchestration transactions. For a customer that both receives and later sends payments, we count the volume only once, with certain limited exceptions where both received and sent payments are counted. Volume serves as a key metric for overall business activity, as growing volume is one of the primary drivers for our revenue growth.


	Three months ended June 30,				Six months ended June 30,				Three months ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022		2023		2022		2023		2022

	(in millions)								(in millions)
Volume	$	15,788	$	14,635	$	31,524	$	29,255	$	16,753	$	15,131	$	48,277	$	44,387

Volume grew 8%11% and 9% for ~~both~~ the three and ~~six~~nine months ended ~~June~~September 30, 2023 compared to the three and ~~six~~nine months ended ~~June~~September 30, 2022, respectively, driven by a combination of continued ~~customer acquisition, a rebound in travel spending, and~~ growth ~~in some of~~with our ~~large~~largest digital commerce ~~marketplaces.~~marketplaces, strong travel demand, and customer acquisition.

Revenue

We generate revenues mainly from transaction fees, which vary based on the type of service the customer utilizes. Transaction fee revenue principally consists of fees for withdrawals and usage. In addition, ~~the Company generates~~we generate revenue from non-volume-based products and services which are based on a fixed fee. We believe that Revenue demonstrates our ability to monetize volume activity on our platform. Our revenues can be impacted by the following:

(i)

Mix in customer size, products, and services;

(ii)

Mix between domestic and cross-border transactions;

(iii)

Geographic region or country in which a transaction occurs; and

(iv)

Pricing and other market conditions including interest rates.

Management closely monitors volume and revenue to ensure that we continue to grow funds and business activity into the platform, expanding our overall scale and the reach of our business.

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PAYONEER GLOBAL INC.

Adjusted EBITDA

In addition to our financial results determined in accordance with GAAP, we believe Adjusted EBITDA, as a non-GAAP measure, is useful in evaluating our operating performance. We use Adjusted EBITDA to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that this non-GAAP financial measure, when taken together with the corresponding GAAP financial measures, provides meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our business, results of operations or outlook. In particular, we believe that the use of Adjusted EBITDA is helpful to our investors as it is a metric used by management in assessing our operating performance. However, non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. In addition, other companies, including companies in our industry, may calculate similarly titled non-GAAP measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measure as a tool for comparison. A reconciliation is provided below for our non-GAAP financial measure to the most directly comparable financial measure stated in accordance with GAAP. Investors are encouraged to review the related GAAP financial measure and the reconciliation of this non-GAAP financial measure to their most directly comparable GAAP financial measures, and not to rely on any single financial measure to evaluate our business.

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~~PAYONEER GLOBAL INC.~~

Adjusted EBITDA


	Three months ended June 30,				Six months ended June 30,				Three months ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022		2023		2022		2023		2022

	(in thousands)								(in thousands)
Net income	$	45,549	$	4,422	$	53,487	$	24,633
Net income (loss)									$	12,825	$	(26,452)	$	66,312	$	(1,819)
Depreciation and amortization		5,909		5,171		11,948		9,626		7,116		5,899		19,064		15,525
Taxes on income		5,747		1,374		14,919		3,341		10,012		2,635		24,931		5,976
Other financial (income) expense, net		(4,318)		4,824		(6,668)		7,519		(1,137)		3,617		(7,805)		11,136
EBITDA		52,887		15,791		73,686		45,119		28,816		(14,301)		102,502		30,818
Stock based compensation expenses⁽¹⁾		16,173		11,890		33,100		24,798		15,330		13,525		48,429		38,323
Share in loss (gain) of associated company		—		7		—		(13)		—		2		—		(11)
M&A related expense (income)⁽²⁾		498		(116)		1,272		(735)		1,745		(1,588)		3,017		(2,323)
Gain from change in fair value of Warrants⁽³⁾		(13,586)		(12,831)		(13,334)		(44,027)
Loss (gain) from change in fair value of Warrants⁽³⁾										7,799		15,095		(5,535)		(28,932)
Restructuring charges⁽⁴⁾										4,488		—		4,488		—
Adjusted EBITDA	$	55,972	$	14,741	$	94,724	$	25,142	$	58,178	$	12,733	$	152,901	$	37,875

⁽¹⁾ Represents non-cash charges associated with stock-based compensation expense, which has been, and will continue to be for the foreseeable future, a significant recurring expense in our business and an important part of our compensation strategy.

⁽²⁾Amounts for the three and ~~six~~nine months ended ~~June~~September 30, 2023 relate to M&A-related third-party fees, including related legal, consulting and other expenditures. Amounts for the three and ~~six~~nine months ended ~~June~~September 30, 2022 relate to a non-recurring fair value adjustment of a liability related to our 2020 acquisition of optile.

⁽³⁾ Changes in the estimated fair value of the warrants are recognized as gain or loss on the condensed consolidated statements of comprehensive ~~income.~~income (loss). The impact is removed from EBITDA as it represents market conditions that are not in ~~control of~~our control.

⁽⁴⁾ The Company initiated a plan to reduce its workforce during the ~~Company.~~three months ending September 30, 2023 and had non-recurring costs related to severance and other employee termination benefits. Please refer to Note 10 to our condensed consolidated financial statements included elsewhere within this Quarterly Report on Form 10-Q for additional information.

Critical Accounting Policies and Estimates

The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported revenues and expenses during the reporting periods. As described in Note 1516 to our condensed consolidated financial statements included elsewhere within this Quarterly Report on Form 10-Q, ~~the Company~~we released ~~its~~our valuation allowance ~~of its~~on deferred tax assets related to our US operations induring the ~~three~~nine months ended ~~June~~September 30, 2023. On an ongoing basis, we evaluate such estimates and judgments, including those described in greater detail below.

We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

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PAYONEER GLOBAL INC.

With the exception of the updates previously described, there have been no updates to our critical accounting policies and estimates in the ~~six~~nine months ended ~~June~~September 30, 2023. For more information, see “Payoneer Management’s Discussion and Analysis of Financial Condition and Results of Operations” in ~~the Company~~’sour Form 10-K filed with the SEC on February 28, 2023.

Recent Accounting Pronouncements

A description of recently issued accounting pronouncements that may potentially impact our financial position, result of operations or cash flows is disclosed in Note 2 to our unaudited condensed consolidated financial statement included elsewhere in this Quarterly Report on Form 10-Q.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We have operations both within the United States and globally, and we are exposed to market risks in the ordinary course of our business, including the effects of interest rate changes and foreign currency fluctuations. Information relating to quantitative and qualitative disclosures about these market risks is described below.

Interest Rate Sensitivity

Our cash and cash equivalents as well as customer funds as of ~~June~~September 30, 2023, were held in cash deposits and money market funds. The fair value of our cash and cash equivalents as well as customer funds would not be significantly affected by either an increase or decrease in interest rates due mainly to the short-term nature of ~~a majority of~~ these instruments. However, a hypothetical 1% increase or decrease in interest rates could have a material effect on our revenues and earnings.

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~~PAYONEER GLOBAL INC.~~

Any future borrowings incurred under our Warehouse Facility would accrue interest at a floating rate based on a formula tied to certain market rates at the time of incurrence (as described above), not to exceed 10.5% per annum for all outstanding balances.

Foreign Currency Risk

While most of our revenue is earned in U.S. dollars, our foreign currency exposure includes currencies of the countries in which our operations are located as well as currencies in which our customer funds are held and may be subject to fluctuations due to changes in foreign currency exchange rates, particularly changes in the Euro, ~~British Pound,~~ Japanese Yen, ~~Vietnamese Dong,~~ Chinese Yuan, Australian Dollar, Canadian Dollar, New Zealand Dollar, Thai Baht, New Israeli Shekel, ~~United Arab Emirates Dirham,~~Philippine Peso, Indian Rupee, Bangladeshi Taka, ~~Indonesian Rupiah, Mexican Peso,~~Turkish Lira, Pakistani Rupee, ~~Singapore Dollar~~ and Hong Kong Dollar. A hypothetical 10% increase or decrease in current exchange rates could have a material impact on our financial results.

In addition, some of our services include the opportunity for Payoneer to generate revenues from foreign exchange transactions as part of the payment delivery process. Our ability to generate such revenues is partially dependent on external factors such as market conditions, applicable regulations and our ability to negotiate with third party financial institutions. The impact of these efforts to optimize foreign exchange can be material to revenues and earnings.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in company reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

As required by Rules 13a-15 and 15d-15 under the Exchange Act, our Chief Executive Officer and Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of ~~June~~September 30, 2023. Based upon their evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were effective.

During the most recently completed fiscal quarter, there has been no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PAYONEER GLOBAL INC.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

From time to time we are a party to various litigation matters incidental to the conduct of our business. Refer to Note 1112 (Commitments and Contingencies) to the condensed consolidated financial statements included in Part I, Item 1 of this Form 10-Q.

For more information on risks related to litigation, see the section titled “Risk Factors — General Risks Related to Payoneer — From time to time we are subject to various legal proceedings which could adversely affect our business, financial condition or results of operations” in our Annual Report on Form 10-K, filed with the SEC on February 28, 2023.

ITEM 1A. RISK FACTORS

As of the date of this Quarterly Report on Form 10-Q, there have been no material changes to the risk factors disclosed in our Annual Report on Form 10-K, filed with the SEC on February 28, 2023. However, we may disclose changes to such factors or disclose additional factors from time to time in our future filings with the SEC.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

~~A total of 607,010 options to purchase common stock of the Company were exercised by a former shareholder~~No unregistered sales during the quarterly period ended ~~June~~September 30, 2023, pursuant to an options agreement with such shareholder in connection with the service on the board of a former director. The above options exercise price was $0.54 per share, and we received proceeds in the amount of $327,785 from the issuance. The issuance of the securities described in this paragraph was made in reliance upon the exemption from registration requirements pursuant to Section 4(a)(2) of the Securities Act.2023.

Share Repurchase Activities

The following table provides information with respect to repurchases made by the Company during the three months ended ~~June~~September 30, 2023. All repurchases listed below were made in the open market.


Period	Total Number of Shares Purchased¹	Average Price Paid Per Share	Total Number of Shares Purchased as Part of Publicly Announced Plans or Progreams²	Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs²	Total Number of Shares Purchased¹	Average Price Paid Per Share	Total Number of Shares Purchased as Part of Publicly Announced Plans or Progreams²	Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs²
April 1, 2023 - April 30, 2023	-	-	-	-
May 1, 2023 - May 31, 2023	147,446	$4.24	147,446	$79,374,648
June 1, 2023 - June 30, 2023	4,053,579	$4.69	4,053,579	$60,348,786
July 1, 2023 - July 31, 2023					1,253,361	$5.05	1,253,361	$ 54,018,490
August 1, 2023 - August 31, 2023					888,351	$5.60	888,351	$ 49,047,412
September 1, 2023 - September 30, 2023					596,380	$6.15	596,380	$ 45,379,068
Total	4,201,025		4,201,025		2,738,092		2,738,092

(1) No shares were repurchased other than through a publicly announced plan or program.

(2) On May 7, 2023, our Board of Directors authorized a stock repurchase program that provides for the repurchase of up to $80 million of our common stock over a period of 24 months. Any share repurchases under this stock repurchase program may be made through open market transactions, privately negotiated transactions or other means including in accordance with Rule 10b-18 and/or Rule 10b5-1 of the Exchange Act. The timing and total amount of repurchases is subject to business and market conditions and the Company’s discretion.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

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ITEM 5. OTHER INFORMATION

Rule 10b5-1 and Non-Rule 10b5-1 Trading Arrangements

During the three months ended ~~June~~September 30, 2023, certain of our officers and directors adopted trading arrangements for the sale of shares of our common stock as follows:


			Plans
	Action	Date	Rule 10b5-1*	Non-Rule 10b5-1**	Number of Shares to be Sold	Expiration
~~Avi Zeevi, Director~~Arnon Kraft, Chief Operating Officer	Adoption	~~May 12,~~August 10, 2023	X		~~300,000~~106,411	~~February 28, 2024~~December 13, 2023
~~Scott Galit, Director~~Itai Perry, Chief Accounting Officer	Adoption	~~May 12,~~August 23, 2023	X		(1)	~~March 10, 2024~~
~~Bea Ordonez, Chief Financial Officer~~	~~Adoption~~	~~June 13, 2023~~	X		~~167,000~~	~~December~~November 15, ~~2024~~
~~Tsafi Goldman, Chief Legal & Regulatory Officer~~	~~Adoption~~	~~June 15, 2023~~	X		~~(2)~~	~~February 29,~~ 2024

*Intended to satisfy the affirmative defense conditions of Rule 10b5-1(c)

**Not intended to satisfy the affirmative defense conditions of Rule 10b5-1(c)

(1) Under this trading arrangement, up to 96,223 shares of common stock ~~will~~may be sold. In addition, common stock may be sold in amounts which represent the net amount of shares remaining following a withholding of shares to cover tax obligations upon the vesting of restricted stock units on various dates ~~throughout~~during the plan. The number of net shares to be sold to accomplish this purpose cannot be reliably determined at this time, as it will depend upon the share price on the vest date.

~~(2) Under this~~ In addition, Mr. Perry’s trading arrangement ~~62,500 shares of~~covers and includes any common stock ~~will be sold. In addition, common stock will be sold in amounts~~purchased by Mr. Perry under the Company’s Employee Stock Purchase Plan (“ESPP”), which ~~represent varying rates of~~purchase is expected to occur on May 15, 2024 for the net amount of shares remaining following a withholding of shares to cover tax obligations upon the vesting of restricted stock units on various dates throughout the plan. The number of net shares to be sold to accomplish this purpose cannot be reliably determined at this time, as it will depend upon the share price on the vest date.

On May 23, 2023, we started to withhold common stock shares associated with net share settlements to cover tax withholding obligations upon the vesting of restricted stock units under our employee equity incentive plansnext offering period. Employees enrolled in the ~~United States. The above-described mechanism was mandated by~~ESPP for the ~~Company and replaced the mechanism which applied previously~~next offering period were entitled to ~~such employees (including Scott Galit, Tsafi Goldman and Itai Perry), where shares were sold to cover the employee’s tax obligation arising from settlement of vested restricted stock units.~~make their purchase elections in October 2023.

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ITEM 6. EXHIBITS

The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q.

Exhibit No.		Description of Exhibit

10.1		Separation Agreement with Keren Levy.*
31.1		Certification of Chief Executive Officer pursuant to Rules 13a-14 and 15d-14 promulgated under the Securities Exchange Act of 1934.*
31.2		Certification of Chief Financial Officer pursuant to Rules 13a-14 and 15d-14 promulgated under the Securities Exchange Act of 1934.*
32.1		Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**
32.2		Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**
101.INS		XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH		XBRL Taxonomy Extension Schema Document
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		XBRL Taxonomy Extension Label Linkbase Document
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

*	Filed herewith.

**	Furnished herewith.

†	Schedules have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The registrant hereby undertakes to furnish copies of any of the omitted schedules upon request by the Securities and Exchange Commission.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


PAYONEER GLOBAL INC.

(Registrant)

By:	/s/ John Caplan
John Caplan
Chief Executive Officer
(Principle Executive Officer)


By:	/s/ Bea Ordonez
Bea Ordonez
Chief Financial Officer
(Principle Financial Officer)
��
Date: ~~August~~November 8^th, 2023

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Fiscal years
2023 (Excluding the six months ended June 30, 2023)	$	7,700
2024		13,449
2025		8,972
2026		1,172
2027 and thereafter		—
Total	$	31,293