Good day, and welcome to The Western Union first quarter 2023 results conference call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note that this event is being recorded. I would now like to turn the conference over to Tom Hadley, Head of Investor Relations. Tom, please go ahead. Thank you. On today's call, we will discuss the company's first quarter 2023 results, then we will take your questions. The slides that accompany this call and webcast can be found at westernunion.com under the Investor Relations tab and will remain available after the call. Additional operational statistics have been provided in supplemental tables with our press release. Joining me on the call today is our Chief Executive Officer, Devin McGranahan, our Chief Financial Officer, Matt Cagwin. Today's call is being recorded, our comments include forward-looking statements. Please refer to the cautionary language in the earnings release and in Western Union's filings with the Securities and Exchange Commission, including the 2022 Form 10-K, for additional information concerning factors that could cause actual results to differ materially from the forward-looking statements. During the call, we will discuss some items that do not conform to generally accepted accounting principles. We have reconciled those items to the most comparable GAAP measures in our earnings release attached to our Form 8-K, as well as on our website, westernunion.com, under the Investor Relations section. I will now turn the call over to our Chief Executive Officer, Devin McGranahan. Good afternoon welcome to Western Union's first quarter 2023 financial results conference call. We are pleased with the progress we are making on our Evolve 2025 strategy and are generally positive about our first quarter results. As we have discussed previously, we see our evolution as a two to three-year journey to return the company to sustainable positive revenue growth. In the near term, changing the trajectory for new customer acquisition and transaction growth has been our priority. Our reported revenue in the first quarter was $1.037 billion. Excluding contributions from Business Solutions, this decreased 1% on a constant currency basis. This reflects several underlying dynamics, including a negative impact of 3 percentage points from the suspension of operations in Russia and Belarus, and a positive impact of 2 percentage points each from the business performance in the Middle East and Argentinian inflation. Adjusted earnings per share came in strong and was $0.43 in the quarter compared to $0.51 in the prior year, which included a contribution of $0.05 from Business Solutions and $0.04 from operations in Russia and Belarus. Matt will further discuss our financial results in more detail and provide an update on our 2023 financial outlook. As you can see from these results, we are progressing against our Evolve 2025 strategy. We are making headway on stabilizing our retail business and accelerating growth in our digital business. Recall, some of our Evolve 2025 goals include getting the retail business to stable and returning our digital business to low double-digit growth rates. As we reported today, we saw sequential improvements in transactions across all regions compared to where we exited last year. More importantly, for the first time in almost two years, we saw positive transaction growth in North America in the first quarter. We also saw a 200 basis point sequential improvement in transaction growth in our European operations when adjusted for the suspension of services in Russia and Belarus. Transactions in our Middle East region also improved by 200 basis points sequentially. Transactions in APAC improved significantly as well. Latin America continued to be the top-performing region in the company, with transactions up 9% year-over-year, an acceleration of 100 basis points over the growth rate we experienced in the fourth quarter. Our results demonstrate that our focus on improving the core operational performance of our business, focusing on winning new customers and improving retention can be achieved. Stepping back for a moment. On the macro front, the first quarter of 2023 continued to be challenging, with persistent high inflation despite interest rates being elevated around the world. Even with that backdrop, 2023 central bank remittance data indicates the resilience of the cross-border re-remittance market with an average principal volume up mid-single digits in the countries which have reported. We are also seeing resilience in our own customer base with constant currency principal per transaction up 5% in the quarter. Our PPT is benefiting from our decision to suspend operations in Russia and Belarus. Even excluding Russia and Belarus, constant currency PPT remains positive. Last October, we launched our Evolve 2025 strategy to return Western Union to positive revenue growth by becoming the market leader in providing accessible financial services to the aspiring populations of the world. In addition to accelerating our core retail and digital remittance businesses, we have been working to launch new products and services to expand our value proposition to our existing 120 million customers. We have successfully launched our digital bank in Germany, Italy, Romania, and Poland. We are now in friends and family testing in Brazil and the U.S. with our digital wallet product. We have expanded our bill pay business in LACA, relaunched our U.S. corrections pay platform, have entered into partnerships in Argentina and Australia to help connect customers to lending products and are nearing the relaunch of our prepaid product in the U.S. as well. While in the short term, these products and services will not be material contributors to our overall revenue growth, they are the foundation of expanding our value proposition, increasing our relevance, improving our customer retention, and providing platforms for future revenue growth. Returning our branded digital business to positive customer and transaction growth has been a top near-term priority over the last three quarters. We launched a new go-to-market approach in August 2022 and shifted from maximizing revenue per transaction to maximizing LTV to CAC. We launched new customer segment offers and, more importantly, revamped our approach to marketing funnel management. We are now far enough into this journey to be able to tell you we believe it's working and durable. We reported to you last quarter that new U.S. outbound branded digital customers were up 30% year-over-year, which contributed to 5% transaction growth in the fourth quarter. I am happy to report that in Q1, we saw a continuation of these trends with U.S. outbound branded digital customers growing at 21% and transactions now growing at 11%, the fastest transaction growth we have seen in the U.S. since 2021. Our expectation has always been that we would see new customer growth first, followed by transaction growth and ultimately revenue growth, which we expect to begin in North America in the third quarter of 2023. In the near term, growing new customers and transactions is an important part of the equation to jumpstart revenue growth. Sustaining that growth at scale longer term will require us to increase the customer's lifetime value and improve our cost of customer acquisition. Our work in these areas is also starting to bear fruit. In the first quarter, while increasing our new U.S. branded digital customers by 21%, we were also able to lower our average customer acquisition cost by roughly 20% in North America. Additionally, retention rates of our U.S. outbound September cohort, the first of our new approach, continue to perform at or above the levels of our existing customer base. In conclusion, we are acquiring more new U.S. outbound branded digital customers than in the recent past. We are acquiring them at a lower cost of acquisition, early signs would indicate we are also retaining them at similar, if not higher levels than in the past. As we mentioned in the last quarter, we have expanded our digital go-to-market program to several of our large European markets. As a result, we have begun to see a similar trajectory across key countries in Europe. New branded digital customers in France, Spain, the U.K., and Germany were all up double digits in Q1, which is a meaningful improvement from recent trends in those countries. Additionally, we've also seen improvements in transaction growth across these same countries and look forward to sharing more with you on future calls. Our retail growth strategy centers around having the right value proposition for customers delivered with the right partners in the right locations and on driving location-level productivity as opposed to just increasing the number of active locations. Frequently, these partners include some of our largest networks, many of which have been partners for decades. Strategic network partners, as we refer to them, are an important element of our overall retail network strategy, as in most cases, they are exclusive to Western Union and provide the customer with a unique value proposition around convenience. Over the past six months, we have been working to better understand how we can improve the in-store experience as well as individual location productivity of the stores in these large networks. The initiatives being developed include creating a more omni-channel offering, introducing new products and services, integrating loyalty programs, improving stage and pay options, simplifying refunds, and focusing on reducing friction in the transaction flow. Beginning in the second quarter of 2022, I began discussing the opportunities to reduce friction for both our retail customers and our agents to better improve the overall Western Union retail experience. Over the past year, we have launched many such initiatives, including streamlining our refunds processes, reducing friction in our compliance processes, increasing transparency of the flow of funds through our track of transfer services. I am pleased to let you know that this focus on agent and customer experience has led to a 30% year-over-year drop in per transaction agent support calls to our call centers. While this is obviously beneficial from a cost perspective, ultimately, we believe it will help us increase retention. We realize we still have a lot of work to do, but are pleased with the progress we are making, and will continue to work to improve the overall experience for our agents and our customers alike. As part of our retail network strategy, we continue to pilot our new point-of-sale system in the U.S. We have developed this new system using a modular architecture and have built a services layer that we can access across multiple front-end technologies, including our legacy point-of-sale systems around the world. This type of modular development allows us to bring to market product enhancements that will improve the customer experience in advance of the full-scale rollout of our new point-of-sale system. Two functions we have developed in recent months are Quick Resend and an improved customer lookup tool, which we call Remember Me. The goal of Quick Resend is to allow customers to complete repeat transactions to known receivers more quickly and can reduce transaction times by up to 75%. We have tested this product enhancement on our legacy technology in select agent locations in the United States in the first quarter and have now begun to roll it out across our entire U.S. footprint. Finally, I would like to give you an update on the progress of our ecosystem strategy. In recent months, we have focused heavily on improving the onboarding and transacting experiences for new customers. In particular, we have been focusing on making it more seamless for existing and former Western Union customers to migrate to the digital bank. We continue to evolve, we believe that these migrated customers and returning customers will continue to be the most valuable and the easiest to retain. To date, our digital bank has enabled us to re-engage with more than 20,000 lapsed Western Union customers. Our offer has not only brought them back to Western Union, it has given them access to an improved money transfer experience, our multi-currency digital wallet, and a Visa debit card. Secondly, converted Western Union customers and prior lapsed customers are doing more than twice the number of transactions they were doing prior to the conversion to the digital bank. These transactions include P2P, top up, funds in and out, and debit card payments, in addition to traditional money transfer. Finally, potentially most surprisingly, we have seen that the cohort that converted from our retail network to our digital bank is among our very best performing. With more money transfer transactions and more revenue than they were providing prior to the conversion. This will be a clear opportunity for us going forward. We realize it is still a small sample relative to our existing customer base, and we will need to continue to scale our efforts more broadly. Early results leave us optimistic about the possibility to provide broader financial services and increase retention with our 120 million customers around the world. Before I turn the call over to Matt to discuss our financial results and outlook in more detail, I would like to highlight a key partnership renewal. We are pleased to announce the extension of our exclusive long-standing relationship with Swiss Railways. They have been a valued partner of ours for nearly 30 years, and we look forward to continuing to serve our Swiss customer base at 135+ Swiss railway locations for many years to come. Thank you for your time, and I will now turn the call over to Matt. Thank you, Devin. Good afternoon, everyone. I'm pleased to be here today to discuss our first quarter results. First quarter adjusted revenue was down 1% to $1.1 billion. Given this is better than our initial expectations, I'd like to walk you through several dynamics in the quarter that led to this outcome. First, we continue to see a negative impact on our results from the suspension of operations in Russia and Belarus, and agent loss and promotional pricing activities related to our new branded digital go-to-market strategy. Russia and Belarus negatively impacted Q1 adjusted revenue by 3 percentage points. Second, Argentina inflation benefited first quarter adjusted revenue by 2 percentage points. Finally, we continue to see strength in LACA and a meaningful improvement in the Middle East. The improvement in the Middle East was driven by a change in monetary policy in Iraq during the first quarter. Our leading compliance capabilities and strong agent network allowed us to react quickly and meet the needs of customers in Iraq, and thus drove a 2 percentage point benefit to adjusted revenue. At this time, it's unclear at what level or for how long this trend will continue. In the first quarter, we saw improving trends from our fourth quarter exit rates on nearly all important dimensions. Our retail money transfer business, while still down, improved sequentially, and we believe it is now moving in the right direction. Our branded digital go-to-market program is progressing, as Devin mentioned, driving 7% branded digital transaction growth across the company in the quarter. With new global branded digital customers up 14%, excluding Russia and Belarus. We also continue to see double-digit growth in other revenue, primarily driven by retail money order business due to the benefit of higher interest rates, the Q3 2022 optimization of our float portfolio and strong transaction growth, as well as strength in our consumer bill pay business in both Argentina and United States. Adjusted operating margin was 20.5% compared to 21.8% last year. The year-over-year decrease in margin was due to increased technology investments primarily related to our Evolve 2025 strategy and a slower reduction in cost relative to our lower revenue. When looking at operating margins on a sequential basis, it improved by nearly 500 basis points, which was above what we initially expected when we shared our outlook in early February. The sequential improvement in our operating margin was due to a few factors. First, lower third-party spend and marketing expense, which was expected. Two, quicker than expected expense reductions related to our cost redeployment program. We have been able to take actions which will allow us to free up more than $35 million in 2023, with almost half benefiting the first quarter. Third, better adjusted revenue than expected, thus increasing leverage of our cost base. The adjusted effective tax rate in the quarter was 13.5% compared to 13% in the prior year period. The increase in adjusted effective tax rate was primarily due to discrete expenses in the current period. Adjusted EPS was $0.43 which compares to $0.51 in the prior year period, which included $0.05 contribution from Business Solutions and $0.04 contribution from Russia and Belarus. Now turning to the C2C segment. Revenue decreased 5% on a constant currency basis while transactions declined 6%. Russia and Belarus negatively impacted revenue by 3% and transactions by 6%. Softness in our retail business and promotional pricing activity related to our branded digital go-to-market strategy were partially offset by growth in Iraq. For our branded digital business, revenue declined 6% on a constant currency basis. As Devin highlighted earlier, we anticipate that our go-to-market strategy would first lead to an increase in new customers, followed by an increase in transactions, and then lastly, an increase in revenue. As a result, promotional pricing activities negatively impacted revenue in the quarter, while global transaction growth accelerated from 2% in the fourth quarter of last year to 7% in Q1. With new customer acquisition up 14% year-over-year in Q1, excluding Russia and Belarus. We remain excited about the progress of our new digital customer, customers and transactions and expect to see positive revenue growth in the back half this year. Moving to the regional results. In the first quarter, North America revenue decreased 8% while transactions grew 1%. The U.S. domestic business and U.S. outbound business to Russia continue to be a drag on our results. While promotional pricing activities related to our new go-to-market strategy negatively impacted revenue growth, branded digital transactions grew 8%, leading to the first quarter of positive overall transaction growth in North America since the second quarter of 2021. Revenue in Europe and CIS was down 13% on a constant currency basis, while transactions declined 23%. Russia and Belarus, which will anniversary next quarter, negatively impacted revenue by 6% and transactions by 19%. The region faced continued headwinds from an agent loss, a difficult macro backdrop and ongoing competitive pressures. Trends continue to improve for both revenue and transactions for the second consecutive quarter. Revenue in the Middle East, Africa and South Asia accelerated meaningfully, growing 6% on a constant currency basis while transactions decreased 3%. Iraq led the region with a higher principal per transaction, driving revenue growth partially offset by continued softness in our retail business. Revenue in Latin America and the Caribbean accelerated and was up 17% on a constant currency basis while transaction growth of 9%. The solid performance in the quarter was led by strength in Argentina, Ecuador and the Dominican Republic. Finally, revenue in APAC was down 5% on a constant currency basis while transactions declined 2% due to softness in Japan, Australia and Korea. Moving to other revenue, which primarily consists of retail bill payment in Argentina and United States and the money order business in the U.S. Other represents 8% of the total company revenue and grew 23% year-over-year on a reported basis. As I discussed earlier, the strength was driven by our retail money order business and our consumer bill pay businesses in both Argentina and United States. Turning to our cash flow and balance sheet. In the first quarter, we generated $137 million of operating cash flow compared to $200 million in the prior year period, with the decrease due to timing of payments. Additionally, our annual transition tax payment related to the 2017 U.S. Tax Act will increase to nearly $120 million in the second quarter. These payments will continue to step up over the next couple years and will end after 2025. Capital expenditures were $57 million in the quarter, with a large portion due to a single agent signing bonus, which we entered into early last year. As a reminder, agent signings bonuses can vary from quarter to quarter, and we anticipate that the mix will shift away from agent signing bonuses. We continue to maintain a strong balance sheet with cash and cash equivalents of $1.2 billion and debt of $2.5 billion. Our leverage ratios were 2.4x and 1.2x on a gross and net basis, which continues to provide us flexibility for potential M&A while we target to maintain our investment credit rating. Moving to our outlook. Today, we reaffirmed our 2023 adjusted financial outlook. We have included improved trends in Iraq in our forecast for the outlook through April, have assumed no incremental revenue for the remainder of the year due to the degree of uncertainty regarding the level and duration. Our outlook assumes no material changes in macroeconomic conditions. As a reminder, we expect adjusted revenue to be down 2%-4%. We expect adjusted operating margin to be in the range of 19%-21%. Finally, adjusted EPS is expected to be in the range of $1.55-$1.65. To recap, we are off to a good start. We're optimistic about the trends we're seeing and the progress that we're making in our Evolve 2025 strategies. Thank you for joining the call, and operator, we're ready to take questions. We will pause momentarily to compile the Q&A roster. As a reminder, each person is allowed one question with one follow-up question. Please note that all participants will be in a listen only mode. Our first question comes to us from Rayna Kumar from UBS. Please ask your question. Hi, good afternoon. Thanks for taking my question. I want to ask about promotional pricing. Can you give us an update on the spending behavior of your newly acquired customers through promotional pricing? How many of the customers are returning to make subsequent transactions at market-based pricing? Thanks for the question. Thanks for joining the call. As we have said previously, and we will continue to reiterate, the customers that we acquired with new customer promotional pricing, which in many cases was first transaction free, have exhibited the same, if not better, characteristics in terms of subsequent transactions and retention rates over 3 and 6-month periods. In fact, we have seen an acceleration in the progress of subsequent transactions over our traditional customers acquired not through promotional pricing. We feel good as we commented that the strategy is working and durable. Our next question comes to us from Darrin Peller from Wolfe Research. Please ask your question. Hey, thanks, guys. Can we just touch on where you think you are now in terms of the promotional pricing changes for digital transaction growth? Maybe just as a quick follow-on to that, I mean, it looks obviously like it's been having an effect on adding digital users. You know, if you could remind us on the stepping stones from here to a more positive inflection on revenue growth that's sustainable, just remind us on the key variables that get us from where we are today, whether it's anniversary pricing and anniversary some of the headwinds from Russia, et cetera, all the way to a positive inflection, would be really helpful. Hey, Darrin, thank you very much for joining the call. As we've talked about in past calls, we're rolling this out in a cohort fashion. We started the program last year in August here in the U.S., with 50 corridors. We've been continuing to bring on customers on a monthly basis since then. It's now been in the market for going on 8, 9 months now. We rolled it out in Q4 to our European business in the same effect. If you go through anything about modeling, our market-based pricing relative to our attrition rate, which I know we've never disclosed publicly for digital, but it's largely a little better than our retail we've disclosed. That will help you get your head around this. As we've talked about also, we expect to have positive revenue growth in the second half this year. Darrin, we have historically said we anticipated, you know, somewhere between 12 and 18 months to anniversary or lap the effects of the new customer and new segment-based pricing. I think we are pleased, as we commented in this call, that we expect in North America, where we first launch it, to move into positive revenue territory. That is happening quicker than we originally modeled due to both, as I explained on the first question, an accelerated return of customers for second, third and fourth transaction, as well as similar, if not elevated, levels of retention. Thanks, Devin. I mean, if I have time for a quick follow-up, just the margin strength was pretty notable in the quarter. We didn't see a change in EPS guidance. Was it just remind us again, was it below the line items, anything nuanced there? Or maybe you could remind us on the cadence of margins as the year progresses. Hey, Darrin. Really, when you think about our outlook for the year, we are very excited about the start of the year. It's giving us a whole lot more financial flexibility, but it is early in the year for us to be making any kind of guidance changes, and we're looking for places where we can make investments and accelerate our path here to long-term sustainable growth. Thanks, guys. Our next question comes to us from Ken Suchoski from Autonomous. Please ask your question. Hi. Good afternoon, everyone. Thanks for, thanks for taking the question here. I just want to ask about the trends in the physical retail business. If I, you know, if I do some macro math, it looks like the transactions in that retail business declined maybe in that mid-single digit range, year-over-year this quarter. You know, it was down kind of low double digits in the prior three quarters. Maybe there's some Russia impact in there. I'm just curious, you know, should we expect that year-over-year growth rate to continue to improve? I guess, you know, is this a business that could get to positive growth later this year? Again, as we have stated, thanks for joining the call. Our goal is to get the retail business to stable. We are trying hard to put in place a retail strategy, as we highlighted on Investor Day, and have been executing on since, that would allow us to attract and retain customers, and more importantly, to increase the retention of the large customer base that we have. Those efforts are beginning to take effect, and you can see that in the change around the world of the retail customer counts and transactions that we've been reporting. I do not anticipate that that will accelerate enough to get us to flat or stable by the end of the year, but we anticipate that being able to achieve that during the course of our Evolve 2025 time period. Okay. All right. That's helpful, Devin. Just as my follow-up, I mean, you know, you talked about some of the momentum in the, in the WU.com kind of branded business, you know, transaction growth accelerating 7% this quarter. You know, what's the expectation there, I guess, in terms of transaction growth for the rest of the year? I guess, how should we expect that to translate into, to revenue growth, just because the pricing, just came in a little bit softer? Hey, Ken, this is Matt. I mean, obviously we're rolling out our new digital go-to-market strategy. You can see the continued improvement in our transactions. You get a larger portion of our customer base that is on that and as we grow our customer base. It's hard for us to forecast. We actually don't provide guidance on digital growth, so I can't really answer that question. I think you can model that if you think through just the path we've seen. It's been pretty sequential now for customer growth now being in the double digits, and you're seeing the transactions working its way towards that level. Right. The same question for the first one on the revenue. Ken, I think we've been pretty clear about what we're seeing in North America, ex the Russia and Belarus progression since we launched it. You know, we're now in double-digit transaction growth in North America. That trajectory we feel pretty good about. As we roll that around the world, you can assess where we're gonna be by the end of the year. Okay. All right. Thank you so much. Our next question comes to us from Tien-Tsin Huang from JPMorgan. Please ask your question. Hey, thanks so much. Good quarter here. Maybe I'll ask a similar question in a different way that's been asked already. Just thinking about the spread on the digital branded business, the spread between revenue growth and transaction growth. Is that more likely to widen out before it narrows again? Could we see that start to narrow ahead? I'm not looking for explicit numbers, just thinking about the relationship between the two as another way to look at where we are in the promotion. Hey, Tien-Tsin, it's Matt Cagwin. Pleasure to see you. Hey, Matt. Hear from you. As you think about the rest of this year, I think you're gonna see it could it widen a little bit more potentially, but I think you're gonna see the high watermark now going into Q2 and then start narrowing as you get into the back half this year and we start generating positive revenue growth. Particularly given the scale of our business, Tien-Tsin, right, we chose North America to start because it's the 600 lbs gorilla. As that turns to positive revenue growth in the back half of this year, almost regardless of what we did in the rest of the world, you're gonna start to see it narrow. Yeah. Makes sense. No, that's encouraging. Look forward to seeing that. My follow-up then, Devin, maybe for you. I know, I think maybe it was Ken that asked it on the retail side. You did say that it's headed in the right direction. Is your statement there driven by the improvement more in the retention side or the acquisition side? I'm just thinking about, you know, in priorities from a priority standpoint, what's more important to you from a KPI perspective? You don't mind me sneaking in one more. Yeah. Not at all. Quick follow-up because people are asking me just the Iraq piece. Is there a way to quantify that? I understand you're not looking for it to extend beyond April, but I'm curious if that was sized for us. Thanks. On the retail side, the most powerful lever, and this is why we shared it at the Evolve 2025 Investor Day. Small increases in retention on a very large base can make a meaningful improvement in the trajectory of that business. The breadth and depth of our retail network is always a great catchment for new customers. Continuing to have them transact with us because we have great experiences, we're easy to do business with, and we've got a good value proposition should hopefully help us improve retention. We're doing modifications, as we talked about on prior calls, in terms of what our network looks like and its ability to attract new customers, into our branded locations from both a exclusivity standpoint, but also competing head-to-head in the independent channel through our improvements with our point of sale and our ongoing efforts with customer loyalty programs and things like that. I'll let Matt answer the question on Iraq. Hey, on the Iraq front, we talked about earlier in the call, it's about 2% of revenue, in Q1. Thanks. Grateful for the time, guys. Thank you. Thank you. Our next question comes to us from Tim Chiodo from Credit Suisse. Please ask your question. Great. Thank you for taking the question. I want to dig into your recent partnership or announcement of being a part of the initial group of apps and neobanks and fintechs that are participating in Visa+. If you could just start off by maybe just giving us a little bit of the background or context on how you made the decision to join and what you thought some of the advantages might be? Tim, great question. Thanks for joining the call. As you know, that particular offer/product/partnership aligns with the launch of our digital wallet in the U.S. We have always been what we would consider to be an open loop network, right? We take funds in from most of the digital wallets, and we pay funds out around the world to many digital wallets, whether that's ATM in India or bKash in Bangladesh. Our basic philosophy of operating a funds in and funds out network is central to who we are. The Visa+ product offer is consistent with how we've constructed and managed our business. With the addition of a digital wallet in the U.S., it seemed to make a lot of sense. Great. Thank you. If you don't mind, a brief mechanical follow-up. Our understanding is that it was discussed on the Visa call that currently the offering is domestic only, but could or potentially could become more cross-border. Should we think about this as just another payout method, meaning there's retail in store, there's send to an account, there's send a card, and now it would be send to another app, potentially in another country, meaning the PayPal or Venmo of country ABC or XYZ, meaning doesn't necessarily have to be sent to a Western Union app? I think yes. Let me try to clarify. Yes, it's U.S. only. We have not agreed to anything beyond that at this point. We do today send to app to others' apps all around the world. For us, this is simply an extension of what we already do. In fact, we have one of the largest payout networks in the world of any kind. An important component of that is payout to account and payout to digital wallet all around the world. For us, you know, we already have our own network, we do that. If we could expand the network for what else we pay out to, I think over time, that would make sense for us. Excellent. Thank you for taking both of those. I appreciate it. Our next question comes to us from Will Nance from Goldman Sachs. Please ask your question. Hey, guys. I appreciate you taking the question. Nice results today. I wanted to follow up, I think on Tien-Tsin's question earlier on some of the moving pieces in adjusted revenue, and the assumptions that baked into the guidance for the remainder of the year. It sounded like, you know, the 2-point contribution from Iraq, a 2-point contribution from Argentina, were some of the major pieces that drove revenue above your expectations this quarter. Could you just kind of clarify, when you're saying you're not assuming a material change in the macro, are you guys assuming that continues or does not continue in the guidance for the remainder of the year? I guess, you know, just a point of clarification, has it continued so far? It sounded like maybe there might still be some activity ongoing. Hey, Will. On the Iraq front, as we talked about on the call, we've assumed that it continues through the end of April. We've assumed nothing beyond April for Iraq. As far as Argentina inflation is concerned, we've always had a fair bit. We call that out. Our actual outlook excludes Argentina inflation. If you wanted to take our headline number of the down 1%, add back the 2%, that kinda gives you the comparable number to compare to our down 2%-4%. We'll continue to back that out 'cause it just bounced around too much for us to try to build it into our guidance. It's one of the it's constant currency, and we back out Argentina inflation. Yeah. Okay, that makes sense. I guess just the Iraq continuing beyond April would be a source of upside. Correct. As you think about though, I mean, as I mentioned earlier in one of the earlier answers. I mean, for us, if it does continue on, it gives us a whole lot of financial flexibility to accelerate our investments. Our, our objective as a target, being within our range, accelerating as fast as possible to our journey to drive us to long-term sustainable growth. It's just gonna give us a lot more levers. Got it. Maybe just to follow up on another lever you might have, the, you know, customer acquisition cost down about 20%. We've heard similar statistics from others in the industry on the digital customer acquisition front. I'm just wondering if you could maybe drill down and provide a little color on what's driving that. How much of that has just been kinda broad-based reduction in digital advertising costs versus some of the, you know, channel optimizations or kind of specific actions that you guys are taking? Yeah. Well, the majority of ours comes from our optimization of the marketing funnel program that we've talked about on prior calls. Finding the most productive parts of the funnel that allow us to increase conversion for dollars spent. I can't comment on others. Our next question comes to us from Ramsey El-Assal from Barclays. Please ask your question. Thanks so much. Could you give us a bit more color on the Iraq policy change? What exactly was that that helped to boost revenues there? Our understanding is the Iraq Central Bank changed their policy with regard to how banks can move money out of the country. We, as a remittance provider, were not subjected to those same policy changes and a result, customers that were traditionally using banks to move money out of Iraq migrated to providers like us. Okay. then maybe you could give us a bit more color in terms of your re-engagement with lapsed customers. What are the kind of techniques that you're using there to re-engage and any levers that you're kind of working to get that cohort sort of moving again? One of the things we've been working on over the last 12 months has been improving what we refer to as contactability. The ability to have marketing permission rights to our customers around the globe in accordance with individual country privacy requirements. That contactability allows us, if a customer lapses, whether they lapse for one transaction, one month, one quarter, or one year, to communicate with them to provide offers and incentives to come back and to re-engage with them in a manner that allows them to, in fact, come back to Western Union. In Europe, particularly in Germany and Italy, as we launched the digital bank, we ramped up our efforts around our lapsed customer base, encouraging them to try our new product with a different experience and a different value proposition. As I was pleased to report today, we're having some success with that, and we're pleased and think it is a platform for us as we further roll out the digital wallet product with some of the added and enhanced benefits that we are now able to offer in Germany, Italy, Romania, and Poland. Fantastic. Thank you very much. Our next question comes to us from Vasu Govil from KBW. Please ask your question. Hi. Thank you for taking my questions. I guess first one for you, Matt, just on around the outlook. I kind of got your comment that it's too early in the year to change the guide, you clearly saw 1Q performance, and you are also expecting, at least US trends to be better in the back half. Should we think about the unchanged guide as basically more conservatism baked into the back half, or are there any timing related factors that might be sort of leaving the guide unchanged, or are you expecting to accelerate investment to the extent there is upside? Just if you could sort of give us your thought process there. Good afternoon, Vasu Govil. As I mentioned a couple of times in the call, it's giving us a lot more flexibility to make investments and look at how we can accelerate our path to long-term sustainable growth. We've not identified where we're gonna go do that, we're also unwilling to commit to a different guide with the macroeconomy conditions we're living through, the uncertainty around Iraq, the stage we are in our Evolve 2025 strategies, as well as we are looking for ways that we can accelerate those strategies. We look forward to updating everybody three months from now when we come back and we've gone through that. Vasu, as we have said since our Investor Day, we are taking what we believe to be a very pragmatic and measured approach to achieving and meeting our public financial commitments while continuing to rapidly evolve Western Union towards our vision of becoming a broader-based financial services provider to the aspiring populations of the world. We will look forward to continuing to update you as the quarters go on, but we're pleased with the progress that we've made in the first quarter. Great. Question for you, Devin. I sort of got all the color you gave on sort of the positive metrics you're seeing in the U.S. from the promotional activity. Any meaningful differences that you are seeing in terms of retention improvement across the other regions where you're expanding promotional pricing? Yeah. I'm actually gonna take this one 'cause I've looked at it more recently. The results are a little bit earlier 'cause we launched Europe and some other parts of the countries around the world we've put the promotional pricing into. What we have seen in the early days is it's comparable to the U.S., but Just remember, it's 60 to 120 days less mature than the U.S., which is why we're continuing to focus on the U.S. on this call. You've got to remember, it is a, it's a multi-part program. I just talked about the contactability and increasing the level of ongoing communication we have with our customers. In addition to the new customer offer, whether that be first transaction free, first transaction 50% off, in combination with the program, we're also putting second, third, fourth transaction into more of a market-based pricing basket, which is helping drive increased retention relative to some of our historical pricing practices. Great. Thank you for the color. Thank you. Our next question comes to us from Bryan Keane from Deutsche Bank. Please ask your question. Yeah. Hi, can you hear me all right? No problem. Thanks for joining, Bryan. Sure, thanks. What's been the response from the competitors from promotional pricing in digital? Has there been much of a response? Have they come back to cut price on their own? No, we have not seen a particularly, quote-unquote, "aggressive response." The players that were historically at the lower end of the market have stayed there, and the players that were historically, you know, similar or above us have stayed there as well. You know, in any given corridor or any given market, there's a give and take, and they're always particularly corridor-specific, particularly in Europe, players that continue to operate in what I would consider a value-destroying manner in terms of their pricing overall. In general, the market is fairly rational and, you know, people have continued doing what they were doing before we made our change. Got it. How much more promotional pricing do you guys expect to do throughout the business? Is there more areas either in retail or just further in digital that you expect to roll this out, or is it kind of the majority of it is complete that you plan to do? You know, we've tackled this question before, given that we operate in 20,000 corridors around the world from 150 countries, give or take, and territories. There are always opportunities to optimize, you know, high volume corridors, long tail corridors. You know, we price at everything from street corner level to time of day. We have a constant and ongoing optimization algorithm and model that's always running, and we continue to tweak that to the best of our ability to get the right combination of customer value proposition, incentives and alignment with our distribution and, you know, our ability to grow transactions. Remember, the big shift is we're really focusing on acquiring customers, managing and increasing their lifetime value, which includes retention, versus maximizing revenue per transaction at a transaction level. Helpful. Thanks for taking the questions. Our next question comes to us from Andrew Schmidt from Citi. Please ask your question. Hey, Devin. Hey, Matt. Thanks for taking the questions. Apologies if I missed this. On operating margin in good performance in the first quarter here, how should we think about the keying as the year progresses? Is there anything lumpy we should be considering from an investment perspective? sounds like there's some flex in the cost base, just curious to get your perspective there. Thanks a lot. Hey, Andrew. Thanks for joining the call today. As I highlighted earlier, there's really two major drivers why it was different than what I, what I expected when we met maybe six, eight weeks ago. The drivers there were the benefit we've gotten from Iraq, just about 200 basis points of revenue, with a normal fall through rate there. We were able to execute on our cost optimization program at a faster pace than we were able to invest, and both those things were unknown and positive surprises to us as we evolved through the quarter from early February till now. Our plan is to go and invest that money. We had always intended to save the OpEx that we were able to identify and save. Those investments will come in the later part of this year as the year progresses. As I mentioned, previously, we are looking. We're monitoring how Iraq evolves. We're looking at other investment opportunities to use any upside we have relative to our guidance. If we have some valuable way to use that to drive long-term sustainable growth, we will make those investments. Got it. Thank you very much for that. If I could follow up just on the independent channel, maybe you could comment on the just the early results from the new POS system, how productivity of those agents that might have in the new POS system compared to the independent base as a whole. Any comments there would be helpful. Thank you very much. To clarify, because it is a pilot and we are in pilot in actual Western Union exclusive locations in the U.S., partially because we wanted agents who were willing to work with us, as we launch the technology, refine the experience. We won't be putting it into the independent agent channel until the back half of this year. Largely the pilot results are really measured around, as you heard me talk about transaction times for customers for specific things like repeat sends, around customers' ability to, or the agent's ability not to have to re-enter data and things like that. The pilot agents are all friendly, hand-selected to work with us through the launch. Got it. Appreciate that clarification. Thanks, Devin. Our next question comes to us from James Faucette from Morgan Stanley. Please ask your question. Hey, guys, this is Jeff Goldstein on for James. Can you guys hear me okay? Yeah, no problem, Jeff. All right, great. I wanted to ask about Europe. Can you talk about some of the trends there? You know, what countries were primarily driving revenue to be down 13% in the quarter? Then I think in your prepared remarks, one issue you called out for the region was competitive pressures. I'm just curious what you're seeing there in particular and how you're kind of going about navigating that backdrop, if anything's different there as opposed to other regions. Jeff, a couple of things, right? Remember those results also still include through the end of the first quarter the exit of Russia and Belarus, which Matt highlighted was a, you know, moderately significant headwind on revenue growth in the first quarter in Europe, which was by far the most impacted region we had. Second, Europe continues to be one of the most, if not the most competitive on both the retail and the digital. In particular, you know, Central and Northern Europe to North Africa continues to face, you know, corridor-specific competitors, as I highlighted, who are maximizing customers and transactions and potentially not revenue. That is an ongoing headwind for us and anyone who competes in those corridors. Hey, Jeff, just to build on Devin's point here, just a couple of things to remind you of. We did also have the one agent loss within Europe that started last year and has continued through Q1. As you think about the countries that are contributing to it, I mean, we've got some really good strength in Spain, Italy, and a few other places. Russia is the biggest place where we're obviously having a drag, as we've highlighted a couple of times in the call. We've got some softness in Germany and France. Helpful. Thank you. Then, second, as my follow-up, you mentioned starting to pilot your digital banking product in the U.S. and Brazil in the quarter, I believe. Just curious if you're learning anything as those roll-outs begin, especially in the U.S. Can you also remind us of the ongoing rollout plans by geography going forward? Yep. a couple of important just notes. In both U.S. and Brazil, we're in what we define as friends and family, which is largely employees and employees' families, and it is truly just a testing. We have not brought non-Western Union affiliated consumers into the offer. Second, in both Brazil and in the U.S., we are working towards what we have affectionately called on these calls one app. As you know, in Europe, we are conducting business across two apps, a digital banking app, which we call Western Union One, or in some markets, WU Plus, and the traditional westernunion.com app, which is a transactional money send. When we launch the new product in the U.S. and Brazil, we will be operating under what we call one app, which will include both the traditional transactional-based service, which has a lower KYC burden and a full-on digital wallet. We will also be able to offer transactional customers a one or two-click upgrade to the digital wallet. That is all in process, and we're obviously learning a lot about how to integrate the two experiences into one. As we learn more, I look forward to updating you. Appreciate it. Thank you. Our final question comes to us from Tyler DuPont from Bank of America. Please ask your question. Great. Thank you. Good afternoon, everyone. This is Tyler DuPont on for Jason. Thanks for the question. I know we're bumping up on time, so I'll try to be quick with these. It seems like LATAM continues to be the bright spot geographically. Can you just speak a little bit more to the success and sustainability of that, growth level? Then maybe just to the level to which you can apply that playbook to other geographies? Tyler, thanks for joining. LATAM is unique on many dimensions. There's 2 things in specific that we benefit from. One, we have a very strong retail footprint in the country, and as we've highlighted, it's a great combination of owned and controlled as well as Western Union-branded independent. We have some particularly strong master agents in the region that we've been working with for many, many years that provide excellent product service delivery and customer service to their customers. The second is, as we rolled out westernunion.com, we had a strategy of maximizing our footprint around the globe. We were early on our digital business in LATAM, and as a result, have strong presence in many of those markets and a strong customer base. Finally, we have an excellent management team that's been in place for many years that does a great job of driving that business. Great. Thank you. I appreciate that. Just briefly following up with inflation, it looks like just the majority of the regions you serve continue to see inflation cooling pretty significantly. Can you just briefly walk me through kind of how you're thinking about inflation and how that kind of trickles down through the PNL? Yeah. Thankfully, most of our, largest portion of our expense base is commission-based, which is driven off as a percentage of revenue. We also have a large portion of our base which is fixed through depreciation or long-term contracts that don't have any kind of, price increases. Then we've got a little bit of labor that we're obviously working our way through. Thankfully, we're well protected from inflation. Tyler, I think you can look at the success we've had in Argentina, which I think is facing 100% inflation this year, on the durability of our business and our ability to manage, not just through the transitory inflation that many countries around the world are seeing, but sustained and high inflation like we have in many countries in LATAM. Great. Thank you very much. Thank you for joining the Western Union First Quarter 2023 Results Conference Call. We hope you have a great day.