Greetings, and welcome to the Paysafe Third Quarter 2022 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded.

I would now like to turn the conference over to your host, Kirsten Nielsen, Head of Investor Relations for Paysafe. Thank you. You may begin..

Thank you, and welcome to Paysafe's third quarter 2022 earnings conference call. Before we begin, a friendly reminder that this call will contain forward-looking statements and should be considered in conjunction with cautionary statements contained in our earnings release and the Company's most recent SEC reports.

These statements reflect management's current beliefs, assumptions and expectations and are subject to factors that could cause actual results to differ materially from those forward-looking statements. You should not place undue reliance on these statements.

Forward-looking statements during this call speak only as of the date of this call, and we undertake no obligation to update them. Today's presentation also contains information that will constitute non-GAAP financial measures under SEC rules.

You can find additional information about these non-GAAP measures and reconciliations to the most directly comparable GAAP financial measures in today's press release and in the appendix of this presentation, which are available on the Investor Relations section of our website.

Joining me today are Bruce Lowthers, Chief Executive Officer; Izzy Dawood, Advisor; and Alex Gersh, Chief Financial Officer. After our prepared remarks, we will address questions received from shareholders through the Say Technologies platform. After that, we'll take questions from the analyst community.

With that, I'll now turn the call over to Bruce..

Thanks, Kirsten. Good morning, everyone, and thank you for joining us today. Let's start with slide 3. On the last earnings call, which was my first quarter as CEO of Paysafe, I shared my early observations on the state of the Company and the path forward.

We discussed the initial steps we were taking to return to our roots of product innovation, rebuild a strong sales engine and to improve efficiency. I'll share more on our progress in these areas later in my remarks. With that in mind, I'd like to first welcome Alex Gersh to Paysafe as our CFO.

Alex brings highly relevant experience, having served as CFO of major brands in gaming and entertainment, most recently as the CFO of Sportradar. Alex has a great track record of driving results and financial discipline for public companies, and I'm very excited to have him on board.

Next, I want to thank our employees for their contributions during this period of change, and I'm pleased to share our financial results for the quarter. Our third quarter revenue of $366 million and adjusted EBITDA of $95.5 million exceeded our financial expectations communicated in August.

Excluding the impact of movement in foreign exchange rates, revenue increased 10% year-over-year, reflecting growth from both, the US Acquiring and Digital Commerce. As for the rest of the year, we are maintaining and tightening our full year outlook, which Izzy will take you through in more detail.

I want to reiterate that Paysafe maintains a healthy financial position with transaction volume exceeding $128 billion, revenue approaching $1.5 billion and adjusted EBITDA exceeding $400 million over the last 12 months.

We also maintained strong liquidity and financial flexibility, while we continue to prioritize reducing our debt and leverage ratio. Before I move on to our strategic updates, I'll quickly touch on the planned reverse stock split, which was announced this morning.

As stated in our press release, we plan to hold a special meeting in December to seek shareholder approval for a 1-for-12 reverse stock split. Once effective, our total number of shares outstanding will be reduced from approximately 727 million to approximately 61 million shares, which is more in line with the companies of our size and scope.

Additionally, the Board believes that effecting a reverse stock split will help us appeal to a broader range of investors and improve the perception of our stock with the investment community, new talent and other stakeholders. Turning to slide 4. During the quarter, we made good progress across the long-term growth accelerators.

As part of our focus to drive innovation, we executed a cost reallocation and changes to the organizational structure, which will fund sales and product investment.

Additionally, as we're going through our 2023 planning, we are allocating a larger percentage of our investment towards new revenue products and improving operational efficiency to improve stakeholder engagement.

In the third quarter, we also welcomed Rob Gatto as Paysafe's first Chief Revenue Officer, with the responsibility for building our global sales organization focused on existing customers, new account acquisition and business development opportunities.

Next, our focus on customer experience, including improvements and fixes to our wallet, which were rolled out over the summer, are yielding positive results with consumers, including increased deposit conversion rates from Q2 to Q3.

In Latin America, we continue to see great progress while supporting our merchants from other countries looking to expand into Latin America and tap into the high growth potential of the region. During the third quarter, we launched with 10 merchants from Paysafe portfolio into Latin America, including with bet365 in Mexico.

Additionally, we saw volume from Paysafe customers that we have launched into LatAm more than double from Q2 to Q3, supported by Paysafe's single API, which enables seamless connection to multiple countries in the region.

Lastly, in North America iGaming, we continue to see robust growth in the regulated iGaming market with more than 45% revenue growth in Q3. We are currently live in 23 states following our third quarter launch in Kansas with DraftKings, Caesars and PointsBet. We look forward to upcoming launches in new states, including Maryland and Ohio.

Moving to slide 5 for an update on our sales function. We're building out our new go-to-market structure, which organizes the sales function by our core verticals, consolidates our systems for better KPIs and visibility and will provide a sales enablement support function for the sales team.

This new model will improve our ability to sell Paysafe as a broader strategic payments offering, improved pre and post deal execution and greatly increase our global pipeline and average deal size.

I spent a lot of time with Rob and the team and remain excited about what we can achieve when we align our product direction and enable our teams to efficiently go after sales. Turning to slide 6, I'll expand upon this a bit more.

Paysafe has a unique proposition for both, merchant acquiring as well as consumer wallets, which comprises our eCash and digital wallet solutions. And this slide illustrates where we play in those constructs, both regionally and across our verticals. We have a unique network, and many of our assets to power end-to-end payments for our core verticals.

We have seen strong performance in our merchant business in North America with double-digit growth year-to-date. That's performed well relative to the market, where we have seen headwinds is in Europe, where we have FX impacts as well as softer market in the verticals we're in. And we have not done as well here cross-selling to our merchants.

For example, we historically have had a bifurcated strategy across iGaming, where we have a strong acquiring presence in North America, but not in Europe, where we play mostly with wallets and eCash with many of the same merchants.

We now have organized the vertical under one leader to drive a holistic sales effort and offer a better solution to our merchants. We also have a great emerging digital asset solution in our wallet business, with strong offering in Europe, we are focused on bringing to the Americas.

Overall, we have a lot of opportunity to expand or deepen our presence, both geographically and across our verticals to fully leverage our assets to better serve our merchants and consumers. Let's turn to slide 7 for an update on digital wallet. In Q3, we saw continued signs of stabilization in progress.

We recorded constant currency revenue growth of 2% from the digital wallet business, an improvement from the year-over-year declines we saw through the first half. Total deposits on our digital wallet were up 9% year-over-year.

Lastly, it's worth pointing out on average that we saw roughly 100,000 new accounts funded monthly in Q3, reflecting continued relevancy of our wallets to consumers. There's still work to do, but we're seeing signs of stabilization despite ongoing market headwinds in Europe.

And I'm confident that the changes we are implementing will drive further improvement and lead to greater customer loyalty and engagement. Now, I'll turn the call over to Izzy to discuss the financial results..

Thanks, Bruce, and welcome, Alex. I would like to add, it has been great working with you on the transition over the last several weeks as well. Let's start with slide 9. Paysafe delivered a solid quarter versus our expectations, with revenue and adjusted EBITDA slightly above our third quarter guidance ranges.

This was driven by continued strong growth from US Acquiring, while Digital Commerce segment performed in line with our expectations. Moving to slide 10 for a summary of our third quarter results. Volume was $32.5 billion, an increase of 5% year-over-year, reflecting continued strength in the Americas, where we saw resiliency in the U.S.

SMB market; as well as strong momentum in regulated iGaming and Latin America. As a reminder, volume does not include our embedded finance solution as the majority of the embedded finance volumes exchange or peer-to-peer transactions, which are not revenue drivers. Total revenue for the third quarter increased 4% to $366 million.

Excluding the impact from changes in foreign exchange rates, revenue increased 10%, reflecting growth in both, US Acquiring and Digital Commerce. Compared to the prior year, the Russia-Ukraine war impacted growth by approximately $4 million or roughly 1%.

Adjusted EBITDA for the quarter was $95.5 million, resulting in adjusted EBITDA margin of 26.1%, primarily reflecting lower margins in the Digital Commerce segment; business mix; as well as one-off items, including a prior year VAT release.

During the quarter, we generated $170 million in free cash flow, bringing our last 12 months free cash flow to $259 million or 64% conversion. As we end the year, we fully expect the full year free cash flow conversion to be in line with our target range of 60% to 70%. Moving to slide 11, I will briefly touch on our GAAP results.

Interest expense was $34.6 million, an increase of roughly $6 million from Q2. The comparison of interest expense of prior year reflects additional debt to fund the acquisitions of SafetyPay as well as increased rates and higher amortization of debt issuance costs.

Our GAAP net income for the third quarter was $1 million compared to a net loss of $147 million in the prior year period. The increase in net income is largely a result of the intangible impairment expense recognized in the prior year.

Adjusted net income for the third quarter was $29.2 million compared to adjusted net income of $39.4 million in the prior year, largely attributable to the higher interest expense and the decline in adjusted EBITDA. Let's move to slide 12 for a discussion on the segment results, starting with US Acquiring.

Q3 volume in US Acquiring was $21.8 billion, an increase of 5% year-on-year. Consistent with our expectations, we've seen a slight moderation of growth versus Q2. Revenue for the third quarter was $185. 4 million, an increase of 12% compared to the prior year. Adjusted EBITDA increased 24% to $50.3 million, reflecting a 27% EBITDA margin.

Overall, our results for the US Acquiring segment reflect continued resiliency in the U.S. SMB market, recovery of the direct marketing vertical and strong operational performance. Turning to slide 13. In our Digital Commerce segment, volumes were $10.7 billion, an increase of 3% year-over-year, reflecting growth from the acquisitions.

Revenue was $180.6 million, a decrease of 4% year-over-year. Excluding the impact from changes in foreign exchange rates and Russia-Ukraine, revenue would have increased 10% year-over-year, reflecting growth in both Digital Wallets and eCash and primarily driven by contribution from acquisitions and our new embedded finance offering.

As a reminder, in September, we lapped the closing of PagoEfectivo acquisition completed last year. And in November, we will lap the closing of the viafintech deal. Adjusted EBITDA for the Digital Commerce segment was $63.5 million in the third quarter compared to $80 million in the prior year, down 7% on a constant currency basis.

Adjusted EBITDA margin of 35.1% was down year-over-year, reflecting one-offs, including a prior year VAT release as well as a small impact from foreign exchange rates. Moving to slide 14 for a quick update on segment reporting. We will be making a couple of changes in Q4.

First, the US Acquiring segment will be renamed to Merchant Solutions, and the Digital Commerce segment will be renamed to Digital Wallets. Second, we are transitioning our integrated and e-commerce solutions, or IES, to the Merchant Solutions segment.

For reference, the IES business line provides e-commerce payment processing for enterprise merchants and represents revenue of $91 million on an LTM basis. These changes better align our segment reporting with our consumer and merchant propositions and our strategic focus moving forward.

Our external reporting will reflect the two new segments beginning in Q4 of this year, and a recast version of the segment financial information is included in the appendix section of this presentation. On slide 15, we will look to our balance sheet and liquidity. Cash and cash equivalents were $220 million at quarter-end.

Net debt was $2.3 billion and our net debt to LTM-adjusted EBITDA ratio was 5.5 times, down from 5.7 times at the end of Q2, driven by FX movement in our euro-denominated debt as well as debt repayment.

In Q3, we completed debt payments and repurchases of approximately $31 million in notional debt, and we continue to monitor pricing of both, our term debt and notes and will act opportunistically to take advantage of current trading levels. Depending on interest rate movements, we expect Q4 interest expense to be between $33 million and $35 million.

Let's move to slide 16 to discuss the outlook. As we close out the year, we expect Q4 revenue in the range of $370 million to $378 million and adjusted EBITDA in the range of $105 million to $109 million, which reflects flat to modest growth year-over-year on a reported basis for both metrics.

Excluding an expected 1% headwind from the Russia-Ukraine War and a 67% headwind from FX, this reflects high-single-digit growth year-over-year in Q4. At the segment level, on a year-on-year basis, we expect Merchant Solutions to grow high single digit and Digital Wallets to increase sequentially.

Similarly, based on the prior segment structure, this would reflect high-single-digit growth from US Acquiring and a sequential increase from Digital Commerce. Turning to the full year on Slide 17. For the full year, we expect revenue to be roughly flat year-over-year on a reported basis and mid-single-digit growth on a constant currency basis.

We expect Merchant Solutions to grow high single digits year-over-year and Digital Wallets to be up low single digits, excluding the headwind from FX and the Russia-Ukraine war. For the total company, adjusted EBITDA is expected to be between $407 million and $411 million, reflecting lower margins, primarily driven by the business mix.

Overall, this reflects a tightening towards the higher end of our most recent full year guidance communicated on our Q2 earnings call. Now, I'll turn the call back to Bruce for closing remarks..

Thank you, Izzy. To summarize, we're pleased with the third quarter results and with the progress our team has made over the last five months. We have simplified the organization and go-to-market model, while adding new talent to help us regain momentum and accelerate growth.

We also have refined and improved our strategic focus and priorities while fostering a more collaborative culture. I'll conclude by reiterating that I continue to feel excited by the potential I'm seeing in the Company.

So much so that in September, I personally purchased 1.2 million shares of Paysafe stock on the open market, which is my earliest opportunity to purchase shares since joining the Company.

While we are facing an uncertain economic environment and have changes in the business to address, I'm confident that the actions we are taking will set us up for growth in 2023 and beyond. Now, let's begin with the Q&A session..

Thank you, Bruce. We are partnering with Say Technologies for the first time with this event to open up a new shareholder Q&A forum, which allows all of our shareholders to submit and upvote questions. We plan to skip questions that were already addressed in our presentation, and we'll also group together questions that share common theme.

After that, we'll turn to questions from our research analyst community. Our first question is from Jason, who would like to know if we have plans for a share buyback..

I'll take that question. So, I think as we've said, we don't have any plans for a share buyback at this time. Considering the current trading levels of our debt and the rising interest rate environment, as we've said in the last quarter as well, reducing our debt is a priority.

So, our leverage ratio is higher than we want it to be, focused on reducing leverage by driving EBITDA growth and debt reduction..

Thank you, Bruce. Next, we have a couple of questions asking about our growth next year and overall opportunities in this competitive market.

What actions is Paysafe taking to differentiate and drive customer engagement? I think we've touched upon this in our presentation, but is there anything you'd like to add or reiterate, Bruce?.

Sure. Look, thanks for the questions. We're still finalizing our budget for 2023. We need to kind of work through that process, see where we exit the year. And then, we'll provide guidance as we normally do in the next earnings call for the 2023 year. As I addressed in kind of the prepared remarks, we're taking a lot of action to reinvigorate growth.

And I expect to support improvement next year. Paysafe, as I talked about last quarter, serves massive TAMs across entertainment verticals with attractive tailwinds over the long term. We're a small player today with plenty of runway to grow in our core markets, and we must do a better job of executing product innovation and sales.

We have lots of opportunities to expand and deepen our presence, both geographically and across our verticals to fully leverage our unique network to better serve merchants and consumers. So, we feel very, very bullish on the opportunities in front of us..

Okay. Thanks, Bruce. Let's take one more question from the Say platform today.

Pietro asks, when will Paysafe become profitable? Izzy, could you help clarify this one?.

Yes. Sure, Kirsten. First, let's clarify that we are profitable today based on the key metrics that we follow and share. We generated adjusted EBITDA of $408 million over the last 12 months, along with positive free cash flow.

When we look at the bottom line, we also generated positive adjusted net income for the last two quarters, which is when we introduced the metric. Even this quarter, we had positive net income on a GAAP basis, and this figure will vary due to nonoperational and noncash items.

If you like any further clarification on these metrics, I welcome you to reach out to your IR department. That could follow up as well..

All right. Thanks, Izzy, and thanks, Bruce. And with that, I would now like to turn the call back over to the operator to open up the phone lines and take questions.

Operator?.

Our first question comes from the line of David Togut with Evercore ISI..

Thank you. Good morning.

Could you drill down into what drove the strength in SMB retail payments in the quarter?.

Look, I think we just had a good quarter in SMB. So, as you've seen throughout the year -- I should have said good morning, but as you've seen throughout the year, Afshin and his team in our US Acquiring business has performed exceptionally well. And so, we continue to see growth there. We continue to see that team performing at a high level.

I think when you look at it compared to peers out there, the team this year has really performed very well. Sales is going very well, and we continue to look for big things coming from our Acquiring business..

Got it.

Just as a quick follow-up, with net debt-to-EBITDA at 5.5x LTM EBITDA, how much headroom do you have until you reach your loan covenant ratios?.

Hey David, it's Izzy. Thanks for the question. Yes, we got fair amount of headroom. I mean, for our first lien, I don't think we can get anywhere close to we get like a 7-plus in terms of our debt covenants. So, a fair amount of capacity there..

Our next question comes from the line of Jamie Friedman with Susquehanna..

Good quarter. Greetings. I wanted to ask about the rebuilding our sales organization slide. Bruce, it's slide 5. You're moving into this new structure verticalized. I was hoping you could share any context about the rationale and what you hope to achieve with the new sales structure..

Yes, Jamie. Good morning. Thanks for the question. Look, as I talked about in the call last quarter, one of the things that was very obvious is our sales teams were very siloed. And so, they were leaving a lot of opportunity on the table. I think when you look at how we're constructing now, lining up around verticals, not so much just by product.

What you're going to have is the opportunity for our team to go in and sell a full solution suite instead of just a point product. We're already having some success with that. You'll hear more about that in the next quarter. But we've brought in some great talent.

I think Rob has done a really phenomenal job of -- in such a short time period, getting us organized, putting together a sales structure, putting together a sales plan on what we're going to sell to those merchants and feel like we've really made a great transition in a short time.

So, I would expect to see, as we're moving forward, results from that fairly quickly. But there's a lot of work to go there. Again, the nice thing is we've been able to sell our e-comm solution into the gaming space. For example, in North America, we just -- because of the silos that we had, we just didn't sell it into Europe.

And now the way Rob has the organization constructed, it's a much more natural motion for us to sell everything into those clients. So, I feel very excited about the change, and I think we'll be very pleased with the outcome..

And then for my follow-up, on slide 7, I wanted to ask about the improvement in the wallet, which is now stabilizing, I think, actually growing for the first time in a while.

So, why are you seeing the improved performance here, Bruce? Is it the total deposits that you're calling out, or is it the new interface that you built? What -- some high-level comments on this would be helpful..

Yes. Again, great question. Look, I think Chirag and his team have done very well here. They came in. They brought in some new talent. Chirag's done a great job of also bringing in some talent to look at the usability of the product.

We've really kind of changed a little bit of our mindset to talk about the experience within the wallet, and we're focusing on bringing new feature functionality to the wallet to create better experiences. Some of the things that his team has done has been to improve that experience, and we've seen benefits from that.

So, people are -- we've reduced some of the friction that is with the wallet. And so, you're seeing a higher conversion rate of deposits. So, the early signs here are very positive. We have still a long way to go on product, but the things that Chirag and his team are doing are -- you can see some results.

And I agree with you, it looks like it's stabilized, and now we'll need to build upon that..

Our next question comes from the line of Darrin Peller with Wolfe Research..

Maybe we could just follow up on the wallet side because the stability was nice to see, and I think the initiatives you guys have been working on seems to be paying off.

Maybe we could just remind us what exactly the strategic vision is for the segment? And then I know there's also been some partnership with Binance and some others in an industry that's been at least perceived as a little bit more risky now.

So, if you could just comment on exposure there?.

Sure. So first, just strategically on the wallet. I think historically, the wallet has been really geared at the iGaming vertical. It is done historically very well. It's been around for 20 years. It's had a great life cycle. I think what you're seeing is now a movement where experience is really important to us.

And so, we're really trying to take into how do we increase the velocity of usage of the wallet, how do we broaden out the wallet a little bit within the entertainment vertical, as I call it, and make it more usable for people not so specific. So, that seems to be the strategy for it.

We also are going to focus a little bit on bringing our products together. So, incorporating more of our e-comm payments orchestration with the wallet. As we move forward, you'll start hearing me talk more and more about that as we get to our Investor Day and Q4. As far as the crypto, we've got a nice little crypto business.

We've been in that business, I think, going back to 2012, if memory serves me correctly, on Binance, specifically. It's a great customer. We've had them for a little while, and we provide a private label wallet for them. So, it's -- from an exposure perspective, we don't really see a lot of exposure from that relationship..

And Darrin, it's Izzy. Overall, the crypto business that we have is less than 3% of our overall revenue base as well. There has been for the last couple of days, obviously, increased volatility, which had a small short-term benefit. But at the end of the day, it's a relatively small exposure..

Okay. Are those Binance downloads or apps, are those in your number, your accounts for digital wallet growth at all, or is that separated out? Because I know it's a different model to some degree. But just a quick follow-up, if you don't mind, I'd just add on. I'll put it all together at once.

The profitability of the story, it looks like you found a place that makes sense from an EBITDA standpoint. It's great to see the guidance where it was narrowed and really maintained.

And when we look at what you're thinking about going forward, I mean, Izzy, if you could just remind us on the levers you guys have in different kinds of environments throughout the next year or so, profitability-wise and expense management wise, would be great..

Yes. I'm not going to get much into next year. As Bruce mentioned, at the Investor Day after the Q4 call, we'll get into it. But I think just going into next quarter, a couple of levers to think about. First and foremost, it is a seasonally more active quarter for sports betting in Q4.

On top of that, there's World Cup, and third, initiatives and stuff that Chirag and the team have been working on. So, as a result, our Digital Commerce business will show a sequential increase. And that business also has a higher EBITDA margin.

So, a combination of those two give us the outlook and confidence into Q4 in terms of levers that will be driving improved profitability..

And just on the Binance, is that included in the numbers or....

It's not the accounts. No, we don't have any accounts of volumes because it's just -- like all the volume that comes through there, it's really peer-to-peer exchanges in wallet -- does not generate revenue..

Our next question comes from the line of Tim Chiodo with Credit Suisse..

Great. I know we hit on this before, but I want to circle back on the strength in U.S. SMB retail. If you could just do a recap of maybe how large that portion is within the current segment of US Acquiring? And also just a recap on the means of distribution.

How much of that is a direct sales force selling into someone else's software? How much is indirect? How much of that might relate to Clover or others? In other words, what is being sold into the SMBs that seems to be gaining a good bit of traction?.

Yes. So, from an overall vertical, it is -- about half of the company is US Acquiring. When you break down a little bit further between a direct and indirect, you can look at it about a 50% split between direct and indirect. So, the team is just performing very well.

What they do have the ability to do is they do sell a variety of platforms, whether it be Clover as you called out in particular or a variety of other platforms they sell as well.

So, I think that drives kind of the value proposition a little bit for them is we have a group that is somewhat agnostic to the POS software or device, and our clients get to choose which ones they want to go with, which everyone matches their needs. So, it's a kind of a unique value proposition from that construct.

But again, I think Afshin and the team are doing a really good job. They've performed right up there with the best in the space this year, and we expect that to continue..

Excellent. Thank you. And a second question around -- in the past, you had mentioned that in some of the gaming verticals in Europe that there had been some other ATMs or LPMs bank-based type of payment methods that had been maybe creating a little bit of price competition, maybe that was account-to-account type stuff.

If you could maybe just update on if anything has changed there, if that's dissipated or if that's still happening.

In other words, is there increasing options and/or pricing pressure associated with European online gaming?.

Yes. Look, from my perspective, what I would say is, sure, all those things are happening, right? There's -- I think that's just the normal piece of competition. Payment types are changing. Avenues are changing on a way to execute things. None of that is impeding our growth. We are impeding our growth, and we have to execute better.

And that's what we're doing. We've reorganized the sales organization to attack that market. And there's no reason to believe that we can't grow in line with our peers as we continue to make progress on the transformation. So, this is a big TAM opportunity, natural tailwinds. We have the assets to compete, and we will compete as we move forward here..

Our next question comes from the line of Dan Perlin with RBC Capital Markets..

I wanted to dive in a bit on your international expansion that you called out specifically around Latin America. I'm just wondering what specifically you're doing in that market. I mean, we've heard from others as well that the Latin American market has -- it’s been quite strong.

So, I'm wondering, one, is it just the market dynamics that are driving this massive growth that you saw recently kind of on a sequential basis, or are there specific things that are transpiring in the product that you're offering that is maybe share gaining? Anything there would be fantastic..

Yes. Let me start off, and I'll ask Izzy to kind of jump in. He'll have a little more of the history of it. But as you know, we've done a couple of acquisitions down there over the last year.

Those are performing very well, right? I mean -- so when you look at our growth rate there, we have a really solid growth rate on those acquisitions, performing in line with what we expected as we did our business case to do the acquisition. So, feel very good about the business.

Obviously, they're small businesses relative to the overall size of the Company. But the product resonates down there. I think there's a lot of growth opportunities for us. We're bringing some of our existing products to Latin America, so we'll be able to cross-sell more. We've opened up some natural channels on -- between Europe and Latin America.

So, we're bringing our customers -- European customers down to Latin America, and that's really going to help accelerate our revenue down in Latin America as well. So, a lot of opportunity for us there, feel very bullish about it. Gustavo and his team doing a great job. And Izzy, if you want to add any....

Yes. Bruce, actually, yes, I'll just double click on it. So one of the key things, obviously, bringing our European gaming operators to Latin America, which is a fast and growing market, is definitely a plus. Why do they want to get down there? Pago has incredibly strong brand recognition in Peru.

And we're basically leveraging the growth of their brand recognition is driving -- it's been performing really well. And the second part, SafetyPay has some really good technology and connections in the real-time banking or open banking space. Again, improving the efficacy of that payment method in multiple Latin American markets.

So, you combine that with our strong operator base in Europe, which, again, that operator base is global. It's turning out to be a very nice set of acquisitions propelling our growth..

Yes. That's a very good point about the corridor. Thank you for that. Just my quick follow-up.

Are you seeing any -- and maybe even more broadly, are you seeing any consumer behavior dynamics just as we think through kind of gaming as kind of a discretionary category versus nondiscretionary? Any weakness there that you can call out? And then, how do you think that market or business in general performs to the extent that we move into a recession or certainly, let's just say, more difficult times ahead?.

Yes. So, thank you for the question. Alex is on as well, and if you want to chime in, in a minute on kind of the gaming experience. But we're not seeing anything right now that indicates any issues with the spend. October was a pretty solid month for us. So, we're feeling -- we're in a good spot.

Again, what I would kind of point out is we have a lot of opportunities to grow and come up to where our peers are performing. So, while some of them that are high-growing organizations may be running into some headwinds, we have a lot of room to continue to improve and accelerate, and we plan on doing that.

So, we're not seeing any real issues around discretionary spend. I think the -- from what we see in the gaming space, the recession doesn't seem to impact that greatly. And Alex has come from that space. He could probably comment better on that..

Bruce, I can only comment -- I can only echo your comments. Certainly, if you've seen what some of the operators have been reporting globally and in the U.S., particularly those that are growing in the U.S., and we have the opportunity to work with the some of the operators in the U.S., you could see that.

Yes. No, it seems to be holding up pretty well. I'm a little surprised by it, quite frankly. So, thank you so much. I appreciate it..

Yes. Thank you..

Thank you. Ladies and gentlemen, that concludes our time allowed for questions. I'll turn the floor back to Mr. Lowthers for any final comments..

Great. Well, look, thank you everyone for your time today. I also want to make sure that we thank Izzy, who has been a great partner with me here over these last six months. Thank you for all your contributions here at Paysafe. And we all wish you well as you move on to your future endeavors, and thank you very much. So, that's it from here.

We really appreciate it, and look forward to talking to everyone soon..

Thank you. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation..