On August 12, Flywire (NASDAQ:FLYW) expanded its partnership with Trustly, bringing “Pay by Bank” open banking payments to customers across the US and Canada. The expansion lets payers authorize ACH and Pre-Authorized Debit transfers straight from their bank login, skipping the routing and account numbers that trip up so many cross-border payments. It is the kind of unglamorous plumbing upgrade that rarely makes headlines, but for a company built on moving money across borders, cutting payment friction is close to the whole business model.
Fewer Failed Payments, Faster Growth
Flywire and Trustly have partnered since 2017, first in Europe, and this expansion carries that same playbook into North America. Trustly runs a real-time balance check the moment a payer authorizes a transaction, catching insufficient funds before the payment is submitted rather than after. For cross-border transfers, Flywire manages the funds through the return window itself, which cuts down on the reversals that have long made international payments messy for clients and their customers alike. “We’re applying the open banking infrastructure we’ve successfully scaled across Europe to North America, enabling our clients to confidently offer their payers a proven experience,” said Kate Moran, Flywire’s Vice President of Global Payments.
The timing lines up with a quarter of accelerating growth. On August 4, 2026, Flywire reported second-quarter revenue up 27.2% year over year to $167.7 million, while total payment volume jumped 38.2% to $8.2 billion. Management raised its full-year guidance for both revenue growth and adjusted EBITDA margin, and the business is no longer leaning on education alone. Flywire signed more than 200 new clients across 45 countries during the quarter, with hospitality wins spanning nearly 90 U.S. hotel properties and education revenue outside its core markets growing more than 30% year over year.
Margins Tell A Different Story
Growth came with a cost. Gross margin slipped to 53.4% in the second quarter of 2026 from 57.0% a year earlier, and adjusted gross margin fell even further, from 61.1% down to 56.6%. That is a meaningful step backward on a per-dollar basis even as the top line expanded by double digits, and it raises the question of whether faster growth is being bought with thinner margins on the payments themselves.
Flywire also still posted a GAAP net loss of $8.1 million for the quarter, an improvement from the $12.0 million loss a year earlier but a loss nonetheless. And the company’s own leadership flagged caution ahead: CFO Cosmin Pitigoi said Flywire is keeping its assumptions for the education vertical conservative because of the current visa policy environment, an acknowledgment that the company’s largest historical vertical faces headwinds outside its control.
What The Smart Money Sees
Hedge fund ownership of Flywire rose from 28 funds to 35 in the most recent quarter, a sign that institutional conviction is building rather than fading. Short interest sits at 9.60% of float, high enough to reflect a real bear camp rather than routine hedging. The stock trades at a forward P/E of 20.45 as of September 3, a middle-of-the-road multiple for a company still growing revenue above 25% a year. Rising fund ownership alongside meaningful short interest suggests the market is still working out how durable that growth really is.
The Real Test Ahead
Flywire’s Trustly expansion is a small, technical move, but it fits a pattern of a company trying to make itself indispensable to how money crosses borders. The growth numbers back that ambition: revenue and payment volume are both accelerating, and management raised guidance rather than trimmed it. But margins moved the wrong direction this quarter, and the company itself is bracing for visa-related softness in education.
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