MoneyHero Limited Class A Ordinary Shares 2026 Q2 Earnings Call

Please go ahead. Hello, everyone, and welcome to MoneyHero's 2026 second quarter earnings conference call.

I'm Gretchen Kwan, Head of Corporate Affairs and Communications at MoneyHero Group. Before we begin, I would like to remind you that today's call will include forward-looking statements, which are inherently subject to risks and uncertainties and may not be realized in the future for various reasons, as stated in our earnings press release, which was issued earlier today and is also available on our IR website. In addition, please note that today's discussion will include both IFRS and non-IFRS financial measures for comparison purpose only. For our reconciliations of these non-IFRS measures to the most directly comparable IFRS measure, please refer to our earnings release and SEC filings. Lastly, a webcast replay and the script of this conference call will be available on our IR website.

Joining me on the call today is Danny Leung, Interim CEO and CFO, who will go over our strategy and business update, operating highlights, and financial performance for the second quarter of 2026. Please note that we will not be holding a Q&A session today. If you have any questions, please contact our investor relations team after the call. With that, let me turn the call over to Danny.

Thank you, Gretchen. Good day, everyone, and thank you for joining us to discuss MoneyHero Group's second quarter 2026 financial results. The underlying trajectory of the business remained resilient, with the second quarter delivering continued improvement in unit economics, approval quality, and cost discipline alongside sustained operational strength in our core markets of Hong Kong and Singapore. Net loss for the quarter was $1.2 million, which reflects foreign exchange rather than any change in our operating trajectory. Adjusted EBITDA loss narrowed 17% year-over-year to $1.6 million in the quarter, and 49% year-over-year to only $2.7 million for the first half of 2026. While Constant FX EBITDA loss, which excludes unrealized foreign exchange impact, narrowed 64% year-over-year to $0.9 million. We ended the period with $28.2 million in cash and no debt.

These progresses alongside a deliberate decision on how we acquire customers, which also shape our reported revenue. Revenue was $15.8 million in the second quarter, down 13% year-over-year. For the first 6 months of 2026, revenue remained essentially flat year-over-year at $32.3 million. However, these headline figures understate the underlying progress we have made due to strategic decision to deploy cash rewards in Singapore and Hong Kong, where there is a growing consumer preference for flexible cash incentive. This allows us to attract high intent customers more cost effectively. Under IFRS accounting rules, these cash rewards are deducted from revenue rather than recorded at a cost. Cash reward totaled $5.1 million in the quarter, up 77% year-over-year from $2.9 million in the prior year period.

On a 6-month basis, cash reward totaled $9.2 million, up 66% year-over-year, with Singapore representing the largest share at $7.3 million and Hong Kong at $1.9 million. Adding these rewards back in, the total transaction value of our business becomes clearer, holding flat year-over-year in the quarter at $20.9 million and up 9% year-over-year to $41.5 million over the first 6 months of the year. This growth over the past half year reflects a deliberate choice. Against a dynamic market environment, we prioritize margin quality, conversion, and operating efficiencies over chasing lower yielding volume, even as application volumes soften. I will now walk through our performance by market and product verticals, our operating metrics, cost management and AI transformation, bottom-line performance, and financial position.

Hong Kong, still our anchor market, held broadly flat year-over-year at $7.8 million, representing half of total group revenue and grew 15% year-over-year to $16.3 million on a 6-month basis. This performance underscores the resilience of our leadership position in Hong Kong and provides an important anchor for the group during a softer quarter in some of the other markets. On an operational volume basis, the total transaction volume of Hong Kong grew 21% year-over-year in the first half. That strength is showing up in profitability too. Hong Kong segment profit surged to $0.5 million in the first half from $0.1 million in the prior year period. At the same time, we remain focused on identifying sustainable opportunities to deepen customer engagement, increase cross-selling, and grow our product relationships in Hong Kong. In Singapore, the underlying operating momentum continued to expand.

Because our cash rewards deployment was heavily concentrated in Singapore, reported revenue declined 20% year-over-year to $6.2 million, mainly reflecting the impact of these cash rewards. On a 6-month basis, Singapore revenue moderated by only 8%. Our disciplined focus on higher margin conversions successfully translated into improving underlying unit economics. When adding back those cash rewards, however, our total transaction value in Singapore actually grew 9% year-over-year in the first half of 2026. In fact, on a 6-month basis, Singapore delivered segment profit of $0.2 million, a powerful turnaround from $0.5 million loss in the prior year period. Credit card revenue declined 18% year-over-year to $8.9 million, and this is where the shift toward cash reward is concentrated. Combined revenue from wealth and insurance was $4.7 million, representing 30% of total revenue, up from 27% in the prior year period.

Within that, insurance revenue declined 7% year-over-year to $2.4 million, and so the increase in contribution reflects the relative resilience of these verticals against credit cards rather than growth in absolute terms during the quarter. On a six-month basis, the underlying product mix trend was more evident. Combined wealth and insurance revenue grew 11% year-over-year to $9.3 million, representing 29% of total revenue, with wealth up 22% year-over-year to $4.8 million. Personal loan and mortgages revenue declined 2% year-over-year to $2 million for the quarter. The first half growth in combined wealth and insurance revenue continued to validate our product diversification strategy. We continued to scale our AI transformation initiative during the second quarter with a focus on simplifying our technology platform, optimizing engineering and operational workflows, and improving productivity across the organization. Technology costs fell 50% year-over-year to $0.5 million through platform consolidation and AI-driven automation.

Advertising and marketing expenses fell 12% year-over-year to $4 million, supported by more disciplined data-driven campaign allocation. Employee benefit expenses were $3.9 million, up 6% year-over-year, balanced against those savings by target investment in employee capabilities to support our higher margin verticals and AI initiatives. Total operating costs and expenses, excluding net foreign exchange difference, declined 12% year-over-year to $18.2 million. Because cash rewards are recognized as deduction from revenue under IFRS, while non-cash rewards are recognized as a cost of revenue, the same shift that reduced reported revenue also drove a 17% year-over-year decline in our cost of revenue to $7.6 million, supported by the more selective customer acquisition spend and higher converting traffic. Cost of revenue as a percentage of revenue improved at three percentage points year-over-year to 48%.

The reduction in technology costs and in advertising and marketing are separate from reward mix and from the movement in the top line. Even in a quarter of lower revenue, we held spend down across customer acquisition, technology, and other operating costs. Approval rate nonetheless expanded nine percentage points from the prior year period to 48%, and approved application declined by a smaller 15%, alongside continued growth in revenue per approved application in both the quarter and the first half of the year. Clear evidence that we are converting a smaller but higher quality funnel more efficiently. Let me turn to product and technology. Last quarter, I described AI as our engine. This quarter, I want to show what it has delivered and what it is building next.

Our in-house voucher management system went live in Hong Kong in July for Apple Gift Cards, which is our largest reward type, cutting delivery time to customers by half and eliminating third-party handling fees. We will extend it to Singapore and to more reward types, including travel, e-commerce, and supermarket vouchers. A single engineer on our team took it from prototype to production in under three months versus a conventional build we estimate would have needed a team of around 10 working for most of a year. Every release still goes through our standard engineering review and sign-off. We are applying the same approach to two more projects. First, a fully AI-assisted conversational experience that combine customer support and product discovery. A user describes what they need in their own words and is guided directly to our right products, contents, and rewards.

We are also structuring our product data and content so third-party Generative AI platforms and search engines can cite MoneyHero directly. So wherever a customer's journey begins, it completes on our platform. With the applications, the reward, and the member relationship staying with us, both roll out market by market within our compliance and control frameworks in Q4 this year. Second, which is the member dashboard, which is a rebuilt experience that gives members one place to track rewards issued directly through the voucher system. Live in Singapore this month, and expanding to Hong Kong and other markets later this year. Upcoming releases add insurance policies, single login, and personalized suggestions. Rewards status queries are one of our largest source of support contacts. So this also lowers support costs while giving members a reason to return between transactions.