- Mixed bag of results released for big name MoneyGram following Ripple’s backing earlier in the year
- Rise in rate of non-US transactions recorded – but overall profitability still not achieved
- "Our third quarter results reflect the continued transformation of our business as we increasingly focus on customer experience improvements”, says CEO in a statement
Famous international money transfer brand MoneyGram has released its latest earnings report – and revealed that it is still running at a loss despite a string of recent successes.
The firm, which is a well-known cross border payments service with a global reach, said in its report covering Q3 of 2019, that it had made an overall net loss totalling $7.7m during the period in question.
The news wiped off almost 7% from the value of MoneyGram International stock listed on the NASDAQ stock exchange at one stage.
However, there were plenty of positives in the report too.
It revealed, for example, that non-US money transfer transactions placed through the company led to a year on year growth rate of 7%.
The news comes after Ripple, a blockchain-powered payments service, acquired a stake in MoneyGram which is believed to be worth $30m.
This transaction, which took place back in July, is set to last for at least two years – and when it was announced, it sent MoneyGram shares skyrocketing.
In a statement announced alongside the earnings report for this quarter, Alex Holmes – who is the chairman and CEO of MoneyGram – said that the more positive results contained within the report reflected the prioritisation of digital as well as “customer experience improvements”.
"Our third quarter results reflect the continued transformation of our business as we increasingly focus on customer experience improvements, cross-border digital growth and industry-leading innovation through our strategic partnership with Ripple", he said.
"While the US market, which continues to be our primary challenge, showed signs of improvement on a sequential basis, we are very pleased that our non-US business achieved year-over-year growth for the quarter”, he added.
It’s not unusual, of course, for a firm as large and well-used as MoneyGram to be running at a loss.
It doesn’t necessarily mean that there is something to worry about; it often means that firms are being heavily subsidised by investors who have confidence in the long-term business model and believe that one day it will turn a profit and they will hence get their returns.
In MoneyGram’s case, Ripple has fulfilled that function.
However, MoneyGram will no doubt still be itching to turn a profit, as much for public relations purposes as anything else.
With the vast majority of consumers not plugged into the mechanics of business growth and investment, becoming profitable must seem like the last piece of the puzzle.
To keep up to date on the latest goings on in the cross border payments world, just head to the magazine pages of our site.
