IMXI 10-K & 10-Q changes, risk factors and insider trading

An investment in our securities involves certain risks. The risks and uncertainties described below reflect the Company’s beliefs and opinions as to factors that could materially and adversely affect the Company and its securities in the future, but are not the only risks that may have a material and adverse effect on the Company, and the risks described herein are not listed in order of the potential occurrence or severity. There is no assurance that we have identified, assessed and appropriately addressed all risks affecting our business operations. Additional risks and uncertainties could adversely affect our business and our results of operations. If any of the following risks actually occur, our business, consolidated financial condition or results of operations could be negatively affected, and the market price for our shares could decline. References to past events are provided by way of example only and are not intended to be a complete listing or a representation as to whether such factors have occurred in the past or their likelihood of occurring in the future. Further, to the extent that any of the information contained in this Annual Report on Form 10-K constitutes forward-looking statements, the risk factors set forth below are cautionary statements, identifying important factors that could cause the Company’s actual results to differ materially from those expressed in or implied by any forward-looking statements made by or on behalf of the Company. There can also be no assurance that the actual future results, performance, benefits or achievements that we expect from our strategies, systems, initiatives or products will occur.

Our money remittance business relies in part on the overall strength of economic conditions. Consumer money remittance transactions are affected by, among other things, employment opportunities and overall economic conditions, such as recession, rising inflation and higher market interest rates. Additionally, consumers tend to be employed in industries such as construction, information technology, manufacturing, agriculture, hospitality and certain service industries that tend to be cyclical and are more significantly affected by weak economic conditions than other industries. This may result in reduced job opportunities for consumers in the United States or other countries in which we operate or that are important to our business, which could adversely affect our business, financial condition and results of operations. In addition, increasesa reduction in employment opportunities may lag other elements of any economic recovery.

If general market and economic conditions in the United States or other countries in which we operate and that are important to our business were to deteriorate, our business, financial condition and results of operations could be adversely impacted. Our agents may have reduced sales or business as a result of weak economic conditions. As a result, our agents may reduce their number of locations, hours of operation, or cease doing business altogether. If consumer transactions decline due to deteriorating economic conditions, we may be unable to timely and effectively reduce our operating costs or take other actions in response, which could adversely affect our business, financial condition and results of operations. Our employees, agents and consumers in a particular country or region in the world may be negatively affected as a result of a variety of diversions, including: geopolitical events, such as war, the threat of war, or terrorist activityactivity, as well as other geopolitical events; natural disasters or the effects of climate change (such as drought, flooding, wildfires, increased storm severity, and sea level rise); power shortages or outages; major public health issues, including pandemics and other public health conditions; and significant local, national or global events capturing the attention of a large part of the population. If any of these, or any other factors, disrupt a country or region where we have a significant workforce, customers or agents, our business could be materially adversely affected. Additionally, economic or political instability, wars, civil unrest, terrorism and natural disasters may make money transfers to, from or within a particular country more difficult. The inability to timely complete money transfers could adversely affect our business.

We derive a substantial portion of our revenue from our money remittance transactions from the United States to the LAC corridor, particularly Mexico, Guatemala, El Salvador, Honduras and the Dominican Republic, and we are exposed to certain political, economic and other uncertainties not encountered in U.S. operations. Consequently, actions or events in LAC or other countries that are beyond our control could restrict our ability to operate there or otherwise adversely affect the profitability of those operations. Furthermore, changes in the business, regulatory or political climate in any of those countries, or significant fluctuations in currency exchange rates, could affect our ability to expand or continue our operations there, which could have a material and adverse impact on our business, financial condition and results of operations. We are also exposed to new political, economic and other uncertainties as a result of the geographic expansion to Europe, the United Kingdom, Africa, and Asia, any of which could adversely impact our business, financial condition and results of operations.

•changes in geopolitical and economic conditions and potential instability in certainvarious regions;

Significant volatility in foreign exchange rates could affect the volume of consumer remittance activity in terms of the principal amount sent or the frequency of money remittances, which may negatively affect our average foreign exchange gain per transaction. Long-term sustained appreciation of the Mexican peso or Guatemalan quetzal as compared to the U.S. dollar could negatively affect our revenues and results of operations. Refer to Part II, Item 7A, Quantitative and Qualitative Disclosures about Market Risk, “Foreign Currency Risk”, for further discussion on foreign currency risk.

We process remittances to Latin America, Europe, Africa and Asia from the United States, Spain, Italy, the United KingdomItaly and Germany and from Canada to Latin America and Africa. Additionally, we have expanded our product and service portfolio to include online payment options, pre-paid debit cards, direct deposit payroll cards, and other digital channel offerings, which may present different cost, demand, regulatory and risk profiles relative to our core remittance business. If we are unable to capitalize on these markets, or if we spend significant time and resources on expansion plans that fail or are delayed, our business will be adversely affected. Even if we are successful, we will be exposed to additional risks in these markets that we do not face in the United States or in our core remittance business, which could have an adverse effect on our business, financial condition and results of operations.

Due to the nature of our business, we face constant exposure to continually evolving cybersecurity risks and other technological risks. Our inability to protect our systems and data from these risks could adversely affect our reputation among consumers, agents, digital partners, card issuers, paying agents, financial institutions, card networks, partners, and investors and may expose us to penalties, fines, liabilities, and legal claims.

While plans and procedures are in place to protect our sensitive data, systems, and networks, we cannot be certain that these measures will be successful and will be sufficient to counter all current and emerging technological threats that are designed to breach our systems to gain access to sensitive information or disrupt our operations. The methods used to obtain unauthorized access, disable or degrade service, or compromise systems change frequently, have become increasingly complex and sophisticated, and are often difficult to detect timely. Threats to our systems and our associated third parties’ systems can derive from human error, fraud, or malice on the part of employees or third parties as well as may result from accidental technological failure. Our defensive data protection measures may not prevent unauthorized access or use of sensitive data. While we maintain insurance coverage that may cover certain aspects of cyber risks and incidents, our insurance coverage may be insufficient to cover all losses, and we may not be able to renew the insurance on commercially reasonable terms or at all. Further, we do not control the actions or technological environments of our agents and they may be susceptible to similar threats as previously mentionedmentioned, which could lead to liability claims against the Company. Although agents have experienced security breaches, in the aggregate, none of these breaches have had a significant or material impact to the Company. In addition, following an acquisition, we take steps to ensure our data and system security protection measures cover the acquired business as part of our integration process and the regulatory framework under which the acquired entities operate. As such, there may be a period of increased cybersecurity risk during the period between closing an acquisition and the completion of our data and system security integration. Our inability to protect our systems and data from these and similar risks could, among other consequences, adversely affect our reputation, business, financial condition, and results of operations.

The majority of our business is conducted through independent sending agents that provide our services to consumers at their business locations. Our sending agents and certain digital partners receive the proceeds from the sale of our money remittances, and we must then collect these funds from the sending agents.agents or digital partners. If a sending agent or digital partner becomes insolvent, files for bankruptcy, commits fraud or otherwise fails to remit money remittance proceeds to us, we must nonetheless complete the money remittance on behalf of the consumer.

We monitor the creditworthiness of our sending agents, digital partners and the financial institutions with which we do business on an ongoing basis. There can be no assurance that the models and approaches we use to assess and monitor the creditworthiness of our sending agentsagents, digital partners and these financial institutions will be sufficiently predictive, and we may be unable to detect and take steps to timely mitigate an increased credit risk.

In the event of a sending agent or digital partner bankruptcy, we would generally be in the position of creditor, possibly with limited security or financial guarantees of performance, and we would therefore be at risk of a reduced recovery. We are not insured against credit losses, except in circumstances of agent theft or fraud. Significant credit losses could have a material and adverse effect on our business, financial condition and results of operations.

Our business relies on the free flow of funds and migrants along all of our remittance corridors, particularly between the United States and the LAC. Changes in U.S. political, regulatory and economic conditions or laws and policies governing immigration, foreign trade, development and investment in the territories and countries where we operate and our customers live, including those recently proposedimplemented by the U.S. government, could adversely affect our business, financial condition and results of operations.

Our business relies in part on international migration patterns, as individuals move from their native countries to countries with greater economic opportunities or a more stable political environment. A significant portion of the industry’s money remittance transactions are initiated by immigrants or refugees sending money back to their native countries. Changes in U.S. and foreign government policies or enforcement,policies, including recent changes that have been, or may be, implemented by theto U.S. Presidentimmigration or Congress, toward immigrationenforcement may have a negative effect on immigration inand/or thesending U.S.behavior andof otherour countries,customer whichbase. This could also have an adverse impact on our money remittance volume orthe growth rate of remittance transactions and/or volumes, and revenues.ultimately Inrevenues addition,for increasedthe Company. Increased immigration enforcement in the United States,States could also adversely affect the level of employment opportunities of immigrants, thus reducing their earning potential and ability to remit funds to their countries of origin.origin in the amount and frequency as it is customary. For example, during fiscal year 2025, total remittances processed decreased as compared to fiscal year 2024, however the average principal sent per transaction was notably higher, indicating a change in consumer behavior.

Reduced or disrupted international migration patterns in the United States, Canada, Europe, Latin America, or Africa are likely to reduce money remittance transaction volumes and therefore have an adverse effect on our business, financial condition and results of operations. Furthermore, significant changes in international migration patterns could adversely affect our business, financial condition and results of operations.

The money transfer business is subject to a variety of regulations aimed at preventing money laundering, human trafficking and terrorism. We are subject to U.S. federal anti-money laundering laws, including the BSA and the requirements of the U.S. Treasury Department’s OFAC, which prohibit us from transmitting money to specified countries or to or from prohibited individuals. Additionally, we are subject to anti-money laundering laws in the other countries and jurisdictions in which we operate and hold licenses including Europe, the United Kingdom, Mexico and Guatemala. We are also subject to financial services regulations, money transfer licensing regulations, consumer protection laws, currency control regulations, escheat laws, privacy and data protection laws and anti-bribery laws. Many of these laws are constantly evolving, unclear and inconsistent across various jurisdictions, making compliance challenging. Subsequent legislation, regulation, litigation, court rulings or other events could expose us to increased program costs, liability and reputational damage.

The CFPB and other regulators have issued regulatory guidance focusing on the need for entities to perform due diligence and ongoing monitoring of third-party vendor and service provider relationships. Moreover, ifIf our regulators conclude that we have not met the standards for oversight of our third-party vendors, we could be subject to enforcement actions, civil monetary penalties, supervisory orders to cease and desist or other remedial actions, which could adversely impact our business, reputation, financial condition and results of operations.

We have no current plans to pay any cash dividends for the foreseeable future. The declaration, amount, and payment of any future dividends on shares of common stock will be at the sole discretion of our board of directors. Our board of directors may take into account general and economic conditions, our financial condition, and results of operations, our available cash and current and anticipated cash needs, capital requirements, contractual, legal, tax, and regulatory restrictions, implications on the payment of dividends by us to our stockholders or by our subsidiaries to us, and such other factors as our board of directors may deem relevant. In addition, our ability to pay dividends is limited by our ability to comply with restrictions in our existing revolving credit facilitiesfacility and may be limited by covenants of any future indebtedness we or our subsidiaries incur. As a result, stockholders may not receive any return on an investment in our common stock unless they sell our common stock for a price greater than that which was paid for it.

We are a global leading omnichannel money remittance services company focused primarily on the United States of America (“United States” or “U.S.”) to Latin America and the Caribbean (“LAC”) corridor, which includes Mexico, Central and South America and the Caribbean. InWe recentalso years,provide we expanded ourremittance services to allow remittances to Africa and Asia from the United States and alsooffer beganmoney offering sendingtransfer services from Canada to Latin America and Africa. Also,We through our recent acquisitions we nowalso provide remittance services from Spain, Italy, GermanyItaly and the United KingdomGermany to Africa, Asia and Latin America. We utilize our proprietary technology to deliver convenient, reliable and value-added services to consumers through a broad network of sending and paying agents. Our remittance services, which include a comprehensive suite of ancillary financial processing solutions and payment services, are available in all 50 states in the U.S., Washington D.C., Puerto Rico and 13 provinces in Canada, as well as in certain locations in Spain, Italy, GermanyItaly and the United Kingdom,Germany, where consumers can send money to beneficiaries in more than 60 countries in LAC, Europe, Africa and Asia. Our services are accessible in person through over 100,000 independent sending and paying agents and 117118 Company-operated stores, as well as digitally through the Internet via our websites, co-branded websites with digital partners and mobile device applications. Additionally, our product and service portfolio include online payment options, pre-paid debit cards and direct deposit payroll cards, which may present different cost, demand, regulatory and risk profiles relative to our core money remittance business.

Money remittance services to LAC countries, mainly Mexico, Guatemala, El Salvador, Honduras and the Dominican Republic, are the primary source of our revenue. These services involve the movement of funds on behalf of an originating consumer for receipt by a designated beneficiary at a designated receiving location. Our remittances to LAC countries are primarily generated in the United States by consumers with roots in Latin American and Caribbean countries, many of whom do not have an existing relationship with a traditional full-service financial institution capable of providing the services we offer. We provide these consumers with flexibility and convenience to help them meet their financial needs. We believe many consumers who use our services may have access to traditional banking services, but prefer to use our services based on reliability, convenience and value. We generate money remittance revenue from fees paid by consumers (i.e., the senders of funds), which we share with our sending agents and digital partners in the originating country and our paying agents in the destination country. Remittances paid in local currencies that are not pegged to the U.S. dollar, Canadian dollar, Eurodollar or British poundEuro can also generate revenue if we are successful in our daily management of currency exchange spreads. We also generate revenue from our “wireRemittance-as-a-Service” as a service(“RaaS”) relationships with digital partners where we receive a fee for facilitating money transfers processed through our proprietary software systems, using our money transmitter licenses and payer network relationships.

Our money remittance services enable consumers to send funds through our broad network of locations in the United States, Canada, Spain, Italy, GermanyItaly and the United KingdomGermany that are primarily operated by third-party businesses, as well as by Company-operated stores located in those jurisdictions. Transactions are processed and payment is collected by our sending agents and those funds become available for pickup by the beneficiary at the designated destination, usually within minutes, at any Intermex paying agents. We refer to our sending agents and our paying agents collectively as agents. In addition, our services are offered digitally through the Internet via our websites (intermexonline.com and online.i-transfer.es), co-branded websites with our digital partners and mobile device applications. For the year ended December 31, 2024,2025, our agent network decreased slightlyincreased by approximately 0.2%, primarily as a result of a lower number of sending agents onboarded during the year relative to ordinary course agent terminations.5.4%. For the year ended December 31, 2024,2025, principal amount sent decreased slightly by approximately 0.8%2.2% to $24.4$23.8 billion, as compared to fiscal year 2023,2024, primarilyand as a result of a lower principal amount sent per transaction. Totaltotal remittances processed were approximately 58.953.9 million for the year ended December 31, 2024,2025, representing ana increasedecrease of approximately 0.4%,8.5%, as compared to fiscal year 20232024 primarily related to decreased volume processed that we attribute to a contraction in the remittance market, particularly the Mexico corridor coupled with a change in consumer behavior remitting a lower number of money transfers but at a higher average principal sent per transaction. This overall decrease was partially offset by increased volume generated by our digital channels and European subsidiaries.

During 2024,2025, the Company executed a restructuring plan primarily related to certain of its foreign operationsdomestic and Laforeign Nacional.operations. For the year ended December 31, 2025, the Company incurred approximately $0.7 million in expenses primarily for a reduction of workforce in certain locations. These restructuring costs are part of the Company's restructuring plan, for which the objectives are to reorganize the workforce, streamline operational processes, integrateclose technologycertain functionality,facilities, and to develop efficiencies within the Company. For the year ended December 31, 2024, the Company incurred approximately $3.1 million in expenses for a reduction of workforce in certain locations, closing of certain facilities, discontinuing technology and disposal of obsolete assets. These expenses includeprimarily approximatelyconsisted $2.3 million inof severance payments and related benefits, $0.4 million in software and software development costs write-offs and $0.4 million in legal and professional fees, which are included in restructuring costs in the consolidated statement of income and comprehensive income.

The Company has paid out $2.3$0.4 million of the above charges during the year ended December 31, 20242025 and has a liability of $0.3 million recorded in accrued and other liabilities in the consolidated balance sheet as of December 31, 2024. The Company anticipates to incur additional restructuring costs through March 31, 2025 of approximately $0.4 million.2025.

As a result of implementing this restructuring plan,strategy, the Company expects to reduce compensation expense and certain facilities related charges in an amount of approximately $2.0$2.5 million a year. The anticipated effect of this reduction in expenses will be primarily realized duringbeginning 2025.in the second quarter of 2026. In addition, the Company does not expect that the execution of this restructuring planstrategy will result in any material reduction of revenues or increase of its ongoing operating expenses.

•new technology or competitors that disrupt the current money transfer and payment ecosystem, including the introduction andof increased consumer preference fornew digital platforms;

•international political factors, including ongoing hostilitiesconflicts in Ukraine and the Middle East,East and other geopolitical developments, political instability, tariffs, including the effects of tariffs on domestic markets and industrial activity and employment, border taxes or restrictions on remittances or transfers from the outbound countries in which we operate or plan to operate;

•our ability to maintain compliance with applicable laws and regulatory requirementsrequirements, including those intended to prevent use of our money remittance services for criminal activity, those related to data and cybersecurity protection, and those related to new business initiatives;

•enforcement actions and private litigation under regulations applicable to the money remittance services;

•our ability to protect our brands and intellectual property rights;

We have encountered and continue to expect to encounter increasing competition as new electronic platforms emerge that enable consumers to send and receive money through a variety of channels. Regardless, we continue to innovate in the industry by differentiating our money remittance business through programs to foster loyalty among agents as well as consumers and have expanded our channels through which our services are accessed to include online and mobile offerings which are experiencing higher consumer adoption. WeDuring 2025, we invested in, and expect to makecontinue a significant investmentinvesting during 20252026 and thereafter to increase our penetration ofof, the digital market, to add digital customers, enhance our digital offerings and increase digital revenues, while maintaining and continuing to develop our retail service offerings. Although we believe that investment in our digital business should provide significant financial benefits in the mid to long term timeframes, these investments are likely, in the shorter term, to adversely affect our results of operation.

Transaction volume is the primary generator of revenue in our business. Revenue on transactions is derived primarily from transaction fees paid by consumers to transfer money. Revenues per transaction vary based upon send and receive locations and the amount sent. In certain transactions involving different send and receive currencies, we generate foreign exchange gains based on the difference between the set exchange rate charged by us to the sender and the rate available to us in the wholesale foreign exchange market. Also, we generate revenues from technology services provided to the independent network of agents that utilize the Company’s technology in processing transactions paid by credit or debit card, check cashing services and maintenance fees, for which revenue is derived by a fee per transaction. In addition, we generate revenue from our “wire as a service”RaaS contracts with digital partners under which we receive fees for facilitating money transfers processed through our proprietary software systems, using our money transmitter licenses and payer network relationships.

Service charges primarily consist of sending and paying agent commissions and bank fees. Service charges vary based on agent commission percentagespercentages, payer fees and the amount of fees charged by the banks. Sending agents earn a commission on each transaction they process of approximately 50% of the transaction fee. Service charges also include transaction processing costs incurred in facilitating money transfers processed through our digital channels. Service charges may increase if banks, processors and payer organizations increase their fee structure or sending agents use higher fee methods to remit funds to us. Service charges also vary based on the method the consumer selects to send the transfer and the payer organization that facilitates the transaction.

General and administrative expenses primarily consist of fixed overhead expenses associated with our operations, including our Company-operated stores, such as information technology, telecommunications, rent, insurance, professional services, non-income or indirect taxes, facilities maintenance, provisionpublic-company forreporting creditrequirements, lossesregulatory compliance requirements and other similar types of operating expenses. A portion of these expenses relate to our Company-operated stores; however, the majority relate to the overall business and compliance requirements of a regulated publicly traded financial services company. Selling expenses include expenses such as advertising and promotion, digital marketing, shipping, supplies and other expenses associated with serving and increasing our networkcustomer of sending agents as well as investing in the expansion of ourbase, digital channel offerings.offerings and network of agents.

We incurred transaction costs associated with completed and potential acquisitions. These costs included all internal and external costs directly related to the transactions, consisting primarily of legal, consulting, accounting and advisory fees and certain incentive bonuses. Due to their significance, they are presented separately in our consolidated statements of income and comprehensive income. For additional information on these acquisitions, see Note 3 to the consolidated financial statements. Transaction costs also include internal and external costs related to the Board’s evaluation of strategic alternatives.alternatives and the pending Merger with Western Union.

Interest expense consists primarily of interest associated with our debt, which consisted of a term loan facility and a revolving credit facility until August 28, 2024. Subsequent to that date, our debt consists of a revolving credit facility. The effective interest ratesrate for the year ended December 31, 20242025 for the term loan facility and revolving credit facility,facility whichwas related to the Company’s A&R Credit Agreement and Second A&R Credit Agreement (each, as defined herein), were 9.02% and 2.51%, respectively.2.78%.

Net income is determined by subtracting operating and non-operating expenses from revenues.revenues and non-operating income.

Our business is organized around one reportable segment that provides money transmittal services primarily between the United States, Canada and certain countries in Europe to Mexico, Guatemala and other countries in Latin America, Africa and Asia through a network of authorized agents located in various unaffiliated retail establishments and 117118 Company-operated stores throughout the United States, Canada, Spain, Italy, GermanyItaly and the United Kingdom,Germany, as well as digitally through the Internet via our websites, co-branded websites with digital partners and mobile device applications. This is based on the objectives of the business and how our chief operating decision maker, the CEO and President, monitors operating performance and allocates resources.

Wire transfer and money order fees, net of $554.8$502.2 million, for the year ended December 31, 20242025 decreased by $6.7$52.6 million, or 1.2%,9.5%, from $561.5$554.8 million for the year ended December 31, 2023.2024. The decrease was primarily due to a decrease inlower transaction volume processed through our retail network of sending agents and Company-operated stores in the year ended December 31, 20242025 compared to the year ended December 31, 2023, mainly2024 as a result of a contraction in the market.market, Thisparticularly decreasethe wasMexico partiallycorridor offsetcoupled bywith $1.9a millionchange in revenueconsumer recognizedbehavior asof sending a resultlower number of themoney changestransfers toat thea termshigher andaverage conditionsprincipal ofsent ourper loyaltytransaction. programAs effectivenoted in the thirdoverview quartersection of 2024. In addition, revenues from our digital channelsabove, for the year ended December 31, 20242025, amountedprincipal amount sent decreased by approximately 2.2% to $23.8 billion whereas the number of transactions decreased by approximately $20.68.5% to 53.9 million, which represents a 58.5% increase as compared to 2023.the same period in 2024. Therefore, the lower number of wire transfers sent resulted in lower fees paid by consumers.

Revenues from foreign exchange gain, net of $87.2 million for the year ended December 31, 2025, decreased by $1.7 million, or 1.9%, from $88.9 million for the year ended December 31, 2024, increased by $1.0 million, or 1.1%, from $87.9 million for the year ended December 31, 2023.2024. This increasedecrease was primarily due to athe higherdecrease foreignin exchangetransaction spreadvolume ondescribed moneyabove, transferspartially sentoffset toby certainan countriesincrease in the LAC slightly offset by a lower average principal amount sent per transaction to countries such as Mexico and Guatemala.transaction.

Other income of $18.5 million for the year ended December 31, 2025 increased by $3.6 million or 24.2% from $14.9 million for the year ended December 31, 2024 increased by $5.6 million or 60.2% from $9.3 million for the year ended December 31, 2023,2024, primarily due to the effect of higher revenuefees generatedrelated fromto otherincreased ancillaryactivity services provided byof our Company-operatedRaaS stores suchrelationships, as check-cashingwell fees,as higher revenues primarily as a result of higher fees related to our payroll card program and an increase of the base fees charged on money transfers and money orders deemed abandoned property, and higher fees related to our wires as a service relationships, as well as an increase in income related to money transfer transactions paid with debit or credit cards.property.

Service charges from agents and banks — Service charges from agents and banks were $388.9 million for the year ended December 31, 2025 compared to $429.0 million for the year ended December 31, 2024 compared to $430.9 million for the year ended December 31, 2023.2024. The decrease of $1.9$40.1 million, or 0.4%,9.3%, was primarily due to the decrease in transaction volume described aboveabove, partiallyas offsetwell byas higherlower transactionpayer processingfees costsas relateda to increased activityresult of better pricing negotiated with our digitalpaying channel offerings.agents.

Other selling, general and administrative expenses — Other selling, general and administrative expenses of $47.9$50.7 million for the year ended December 31, 20242025 increased by $0.2$9.2 million, or 0.4%,22.2%, from $47.7$41.5 million for the year ended December 31, 2023.2024.

Our money remittance services enable consumers to send funds through our broad network of locations in the United States, Canada, Spain, Italy and Germany that are primarily operated by third-party businesses, as well as by Company-operated stores located in those jurisdictions. Transactions are processed and payment is collected by our agents (“sending agent(s)”) and those funds become available for pickup by the beneficiary at the designated destination, usually within minutes, at any Intermex payer location (“paying agent(s)”). We refer to our sending agents and our paying agents collectively as agents. In addition, our services are offered digitally through the Internet via our websites (intermexonline.com and online.i-transfer.es), co-branded websites with our digital partners and mobile device applications. For the threesix months ended MarchJune 31,30, 2026, our agent network decreased slightly by approximately 0.6%.5.5% primarily as a result of a lower number of agents onboarded during the period relative to ordinary course agent terminations. For the threesix months ended MarchJune 31,30, 2026, principal amount sent decreased by approximately 11.4%12.0% to $4.9$10.4 billion, as compared to the same period in 2025, and total remittances processed were approximately 11.223.7 million, representing a decrease of approximately 12.0%, as compared to the same period in 2025 primarily related to decreased volume generated that we attribute to a contraction in the retail remittance market, particularly the LAC corridor. This overall decrease was partially offset by increased volume generated by our digital channels and European subsidiaries.channels.

In addition, the consummation of the Merger was conditioned upon (i) the expiration or termination of the applicable waiting period under the HSR Act, which waiting period under expired on October 6, 2025, and (ii) approval of the stockholders of the Company, which approval was received at a special meeting of stockholders of the Company on December 9, 2025.

The Merger Agreement contains termination rights for the Company and Western Union, including a right for either party to terminate if the Merger is not consummated by MayNovember 11,10, 2026 (subjectas toautomatically certain automatic extensionsextended to obtain certain regulatory approvals as set forth in the Merger Agreement). Upon termination of the Merger Agreement, (i) Western Union, upon termination of the Merger Agreement by the Company or Western Union due to a Restraint relating to any antitrust laws, or the failure to obtain necessary consents, approvals or clearances related to antitrust laws, would be required to pay the Company a termination fee equal to $27.3 million, and (ii) the Company, under specified circumstances, including termination of the Merger Agreement by Western Union as a result of an Adverse Recommendation Change (as defined in the Merger Agreement), would be required to pay Western Union a termination fee equal to $19.8 million.

We have encountered and continue to expect to encounter increasing competition as new electronic platforms emerge that enable consumers to send and receive money through a variety of channels. Regardless, we continue to innovate in the industry by differentiating our money remittance business through programs to foster loyalty among agents as well as consumers and have expanded our channels through which our services are accessed to include online and mobile offerings which are experiencing higher consumer adoption. During 2026, we expect to continue investing in increasing our penetration of the digital market, to add digital customers, to enhance our digital offerings and to increase digital revenues, while maintaining and continuing to develop our retail service offerings. Although we believe that investment in our digital business should provide significant financial benefits in the mid to long term timeframes, these investments are likely, in the shorter term, to adversely affect our results of operation.operations.

The market for money remittance services is very competitive. Our competitors include a small number of large money remittance providers, such as such as Western Union, MoneyGram, Remitly and Euronet, financial institutions,institutions banksand banks, and a large number of small niche money remittance service providers that serve select regions. We compete with larger companies, such as Western Union, MoneyGram, Remitly and Euronet, and a number of other smaller money services business (“MSB”) entities. We generally compete for money remittance agents on the basis of value, service, quality, technical and operational differences, commission structure and marketing efforts. As a philosophy, we sell credible solutions to our sending agents, not discounts or higher commissions, as is typical for the industry. We compete for money remittance customers on the basis of trust, convenience, service, efficiency of outlets, value, enhanced technology and brand recognition.

As noted above, current political, social, economic and market conditions in the United States, including recent economic, trade and immigration enforcement actions taken by the current administration in the U.S., as well as in foreign countries, including those that are destinations for money transfers or in which we currently operate remain volatile. There is uncertainty as to the economic and financial impact of such conditions. Our business has generally been resilient during times of economic instability as money remittances are essential to many recipients, with the funds used by the receiving parties for their daily needs; however, continued enhanced immigration enforcement activities in the U.S., prolonged volatility in the market, continued global economic and geopolitical uncertainty, and long-term sustained appreciation of the Mexican peso or Guatemalan quetzal as compared to the U.S. dollar could negatively affect our revenues and profitability. Moreover, as noted above, we have experienced a reduction in revenues generated that we attribute to a contraction in the remittance market, particularly the LAC corridor, which may reflect this increased volatility and current economic conditions.

Trends in the cross-border money remittance business tend to correlate to immigration trends, global economic opportunity and related employment levels in certain industries such as construction, information technology, manufacturing, agriculture and hospitality, as well as other service industries. The three largest remittance corridors we serve are United States to Mexico, United States to Guatemala and UnitesUnited States to the Dominican Republic. According to the latest information available from the World Bank Remittance Matrix, the United States to Mexico remittance corridor was one of the largest in the world in 2025. In addition, changes to U.S. immigration, tariffs, trade, economic, tax and other policies may have both positive and negative effects on our business, none of which can be predicted with any degree of certainty.

WeFrom incurredtime to time, we may incur costs associated with restructuring plans related to our domestic and foreign operations. These costs includedinclude all internal and external costs directly related with the restructuring and consist primarily of severance payments, write-off of assets and certain legal and professional fees.

We incurredincur transaction costs associated with completed and potential acquisitions. These costs includedinclude all internal and external costs directly related to the transactions, consisting primarily of legal, consulting, accounting and advisory fees and certain incentive bonuses. Due to their significance, they are presented separately in our condensed consolidated statements of income and comprehensive income. Transaction costs also include internal and external costs related to the Board’s evaluation of strategic alternatives and the pending Merger with Western Union.

Interest expense consists primarily of interest associated with our debt, which consists of a revolving credit facility. The effective interest rate for the threesix months ended MarchJune 31,30, 2026 for the revolving credit facility was 2.10%.2.14%.

Our income tax provision includes the expected benefit of all deferred tax assets, including our net operating loss carryforwards. After consideration of all evidence, both positive and negative, management has determined that no valuation allowance is required at MarchJune 31,30, 2026 on the Company’s U.S. federal or state deferred tax assets; however, a valuation allowance has been recorded as of MarchJune 31,30, 2026 on deferred tax assets associated with foreign net operating loss carryforwards. Our income tax provision reflects the effects of state taxes, non-deductible expenses, share-based compensation expense, and foreign tax rates applicable to the Company’s foreign subsidiaries that are higher or lower than the U.S. statutory rate.

Three Months Ended MarchJune 31,30, 2026 Compared to Three Months Ended MarchJune 31,30, 2025

Wire transfer and money order fees, net of $99.8$107.6 million for the three months ended MarchJune 31,30, 2026 decreased by $20.4$25.4 million, or 17.0%,19.1%, from $120.2$133.0 million for the three months ended MarchJune 31,30, 2025. The decrease was primarily due to a decrease inlower transaction volume processed through our retail network of sending agents and Company-operated stores in the threesecond monthsquarter ended March 31,of 2026 compared to the threesecond monthsquarter endedof March2025 31,as 2025,a whichresult we primarily attribute toof a contraction in the retail remittance market, particularly the LAC corridor. As noted in the overview section above, forFor the three months ended MarchJune 31,30, 2026, total principal amount sent decreased by approximately12.5%, 11.4%and tototal $4.9transaction billion whereas the number of transactionsvolume decreased by approximately 12.0% to 11.2 million,12.0%, as compared to the same period in 2025.2025, Therefore, the lower number of wire transfers sent resultedresulting in lower fees paid by consumers.

Revenues from foreign exchange gain, net of $16.3$16.7 million for the three months ended MarchJune 31,30, 2026 decreased by $3.9$7.0 million, or 19.3%,29.5%, from $20.2$23.7 million for the three months ended MarchJune 31,30, 2025. This decrease was primarily due to the decrease in transaction volume described above, partially offset by an increase in the averageand principal amount sent perdescribed transaction.above.

Other income of $5.9$6.9 million for the three months ended MarchJune 31,30, 2026 increased by $1.9$2.4 million, or 47.5%,53.3%, from $4.0$4.5 million for the three months ended MarchJune 31,30, 2025 primarily due to the effect of higher fees related to increased activity of our RaaS relationships, under which the number of transactions processed and total principal sent increased by approximately 156%178.0% and 127%,187.0%, respectively.

Service charges from agents and banks — Service charges from agents and banks were $79.1$85.8 million for the three months ended MarchJune 31,30, 2026 compared to $93.8$102.3 million for the three months ended MarchJune 31,30, 2025. The decrease of $14.7$16.5 million, or 15.7%,16.1%, was primarily due to the decrease in transaction volume described above, as well as lower payer fees as a result of better pricing negotiated with our paying agents.

Salaries and benefits — Salaries and benefits of $18.9$17.4 million for the three months ended MarchJune 31,30, 2026 increaseddecreased by $0.6$1.1 million, or 3.3%,5.9%, from $18.3$18.5 million for the three months ended MarchJune 31,30, 2025. The increasedecrease is primarily due to thelower Company's investment in talent acquisitioncompensation and improvedbenefits compensationbased foron ourcurrent salesfinancial forceperformance andas well as lower total employee headcount. These decreases were offset by higher share-based compensation as a result of timing of annual grants of stock awards to certain employees.

Other selling, general and administrative expenses — Other selling, general and administrative expenses of $11.6$11.1 million for the three months ended MarchJune 31,30, 2026 increaseddecreased by $0.6$1.3 million, or 5.5%,10.5%, from $11.0$12.4 million for the three months ended MarchJune 31,30, 2025. The increase was primarily the result of $0.8 million - higher IT related expenses incurred to sustain our business expansion and to improve our technology environment.

Provision for credit losses — Provision for credit losses of $2.9$2.6 million for the three months ended MarchJune 31,30, 2026 increased by $0.8$0.7 million, or 38.1%,36.8%, from $2.1$1.9 million for the three months ended MarchJune 31,30, 2025. The increase is primarily due to a higher chargebacks of uncollected online money transfer transactions, and an increase in write-offs of agent receivable balances primarily as a result of sending agents that were not able to pay in accordance with the original terms of their agreements with us and are, accordingly, subject to our normal collection procedures.procedures as well as higher chargebacks of uncollected online money transfer transactions.

Transaction Costscosts — Transaction costs of $1.2$0.7 million and $2.2 million for both the three months ended MarchJune 31,30, 2026 and 2025, respectively, consist primarily of financial advisory fees as well as other professional fees and legal fees incurred in connection with the Company's evaluation of strategic alternatives,alternatives including the pending Merger with Western Union and business acquisition transactions.

Depreciation and amortization — Depreciation and amortization of $4.7$4.8 million for the three months ended MarchJune 31,30, 2026 increased by $1.1 million from $3.6$0.3 million or 30.6%,6.7% from $4.5 million for the three months ended MarchJune 31,30, 2025. The increase is primarily the result of higher depreciation associated with additional software developed being placed into production and computer equipment acquired to support our proprietary software enhancements and increasing sending agent network.

Interest expense — Interest expense of $2.2$2.3 million for the three months ended MarchJune 31,30, 2026 decreased by $0.8 million or 25.8% from $2.7$3.1 million for the three months ended MarchJune 31,30, 2025. The decrease was primarily due to lower usage of our revolving credit facility and lower market interest rates paid during 2026.

Income tax provision — Income tax provision was $1.0$2.2 million for the three months ended MarchJune 31,30, 2026, which represents a decrease of $2.6$3.2 million from an income tax provision of $3.6$5.4 million for the three months ended MarchJune 31,30, 2025. The decrease in income tax provision was mainly attributable to a decrease inlower income before taxes primarily due to the factors discussed above.

We reported netNet incomeIncome of $0.5$4.2 million for the three months ended MarchJune 31,30, 2026 compared to netNet incomeIncome of $7.8$11.0 million for the three months ended MarchJune 31,30, 2025, which resulted in a decrease of $7.3$6.8 million, or 93.6%,61.8%, due to the same factors discussed above.

Earnings per Share - Basic for the three months ended MarchJune 31,30, 2026 was $0.02,$0.14, representing a decrease of $0.23, or 92.0%,62.2%, compared to $0.25$0.37 for the three months ended MarchJune 31,30, 2025.

Earnings per Share - Diluted for the three months ended MarchJune 31,30, 2026 was $0.02,$0.14, representing a decrease of $0.23, or 92.0%,62.2%, compared to $0.25$0.37 for the three months ended MarchJune 31,30, 2025.

The decrease in both basic and diluted earnings per share (“EPS”) largely reflects the decrease in net income discussed above, offset by a reduced share count as a result of the stock repurchases executed during the first six months of 2025.above.

Adjusted Net Income for the three months ended MarchJune 31,30, 2026 was $3.8$7.2 million, representing a decrease of $7.1$8.0 million, or 65.1%,million from Adjusted Net Income of $10.9$15.2 million for the three months ended MarchJune 31,30, 2025. The decrease in Adjusted Net Income was primarily due to the decrease in netNet income asIncome discussed above,above slightly offset byand the higherlower net effect of the adjusting items detailed in the table below.