WEX posts record Q2 revenue, raises 2023 guidance

Photo / Renee Cordes WEX Inc. is headquartered on Portland's East End.

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WEX Inc. (NYSE: WEX), the Portland-based global commerce platform, on Thursday posted a 4% jump in second-quarter revenue to a record $621.3 million driven by growth in the company's benefits and corporate payments divisions.

Adjusted net income attributable to shareholders was $159.3 million, or $3.63 per diluted share. That's 2% below a year ago but higher than the $3.51 per share consensus forecast of analysts polled by Zacks Investment Research.

Over the last four quarters, the company has surpassed consensus estimates four times.

Buoyed by a strong second quarter, WEX raised its financial guidance for the full year.

"WEX achieved a strong first half of 2023 as we delivered another impressive quarter with record high second-quarter revenue," said CEO Melissa Smith, who also serves as the company's chair. "We achieved this growth despite a dynamic macro-environment and declines in fuel prices."

She also highlighted strategic initiatives during the quarter, including further expansion of the company's electric vehicle capabilities and the application of machine learning and artificial intelligence tools in WEX's processes.

"As we head into the second half of 2023, she said, I remain confident in WEX’s path forward and the long-term growth opportunities ahead.”

Bullish outlook

For the full year, WEX said it now expects revenue in the range of $2.50 billion to $2.52 billion, up from the previous guidance range of $2.45 billion to $2.49 billion.

Adjusted net income attributable to shareholders is now expected to be in the range of $14.15 to $14.35 per diluted share, an increase from the previous forecast of $13.85 to $14.25 per diluted share.

For Q3 specifically, WEX expects revenue in the range of $629 million to $639 million and adjusted net income attributable to shareholders in the range of $3.65 to $3.75 per diluted share.

Third-quarter and full-year guidance is based on assumed average U.S. retail fuel prices of $3.70 and $3.72 per gallon, respectively. The guidance also assumes around 45.2 million fully diluted shares outstanding for the full year.

$100M venture capital plan

In a separate announcement, WEX unveiled plans by its venture capital arm to invest up to $100 million through the end of 2025 in early-stage business startups driving the energy transition to electric vehicles.

Investments will target areas including fleet electrification, charging, energy management and optimization, and related technology, the company said.

WEX Venture Capital has already started the "Electric Avenue" trajectory with minority investments in Chargetrip, a Netherlands-based provider of race prediction and EV routing for private drivers and commercial fleets; and ev.energy, a U.K.-based providers of a managed charging software platform for electric vehicles.