0001558370-22-017161 | 10-Q | XBRL Viewer

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PROPERTY, EQUIPMENT AND SOFTWARE, NET (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Property, Plant and Equipment [Line Items]
Property, equipment and software	$ 45,359		$ 45,359		$ 45,373
Accumulated depreciation	(31,808)		(31,808)		(33,233)
Property, equipment and software, net	13,551		13,551		12,140
Depreciation expense	2,082	$ 1,714	6,153	$ 5,155
Computers, software and peripheral equipment
Property, Plant and Equipment [Line Items]
Property, equipment and software	31,296		31,296		32,379
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property, equipment and software	9,597		9,597		8,920
Furniture and office equipment
Property, Plant and Equipment [Line Items]
Property, equipment and software	$ 4,466		$ 4,466		$ 4,074

GOODWILL AND INTANGIBLE ASSETS, NET - Intangible assets, net (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Finite-Lived Intangible Assets [Line Items]
Intangible assets	$ 80,418		$ 80,418		$ 70,423
Accumulated amortization	(40,052)		(40,052)		(32,894)
Intangible assets net	40,366		40,366		37,529
Amortization expense	3,203	$ 2,721	8,758	$ 8,194
Internal use software
Finite-Lived Intangible Assets [Line Items]
Intangible assets	67,245		67,245		55,164
Impairment of internal use software	614	$ 0	614	$ 114
Developed technology
Finite-Lived Intangible Assets [Line Items]
Intangible assets	$ 13,173		$ 13,173		$ 15,259

WARRANTS - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands	Sep. 30, 2022	Jun. 25, 2021
WARRANTS.
Exercise price of warrants	$ 11.50
Warrants outstanding	25,158,086
Warrants outstanding amount	$ 30,945
Warrants forfeited		723,333

OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
OTHER CURRENT ASSETS
Prepaid expenses	$ 15,425	$ 9,598
Income receivable	8,331	9,825
Prepaid income taxes	7,982	2,789
Other	3,546	2,812
Total other current assets	$ 35,284	$ 25,024

OTHER PAYABLES (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
OTHER PAYABLES
Employee related compensation	$ 54,501	$ 47,007
Commissions payable	11,810	10,712
Accrued expenses	9,450	10,661
Lease liability	9,067	9,290
Other	2,160	1,704
Total	$ 86,988	$ 79,374

GOODWILL AND INTANGIBLE ASSETS, NET (Tables)

9 Months Ended

Sep. 30, 2022

GOODWILL AND INTANGIBLE ASSETS, NET

Goodwill balances and adjustments to those balances


	December 31,		Goodwill	Translation	September 30,
	2021		Acquired	Adjustments	2022

Total goodwill	$	21,127	—	(2,888)	$	18,239

Schedule of composition of intangible assets, grouped by major classifications


	September 30,		December 31,
	2022		2021
Internal use software	$	67,245	$	55,164
Developed technology		13,173		15,259
Intangible assets		80,418		70,423
Accumulated amortization		(40,052)		(32,894)
Intangible assets, net	$	40,366	$	37,529

SIGNIFICANT ACCOUNTING POLICIES - Revenue Recognized From Contracts With Customers (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers	$ 143,871	$ 122,011	$ 424,667	$ 332,370
Revenue from other sources	15,046	640	19,398	1,814
Total revenues	158,917	122,651	444,065	334,184
Revenue recognized at a point in time
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers	134,394	112,431	395,400	312,199
Revenue recognized over time
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers	$ 9,477	$ 9,580	$ 29,267	$ 20,171

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

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- Definition

Amount of revenue recognized from goods sold, services rendered, insurance premiums, or other activities that constitute an earning process. Includes, but is not limited to, investment and interest income before deduction of interest expense when recognized as a component of revenue, and sales and trading gain (loss).

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+ Details

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 30, 2022	Dec. 31, 2021
CONDENSED CONSOLIDATED BALANCE SHEETS
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	380,000,000	380,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	3,800,000,000	3,800,000,000
Common stock, shares issued	350,193,687	340,384,157
Common stock, shares outstanding	350,193,687	340,384,157

INCOME TAXES

9 Months Ended

Sep. 30, 2022

INCOME TAXES

INCOME TAXES

NOTE 12 - INCOME TAXES

The Company had an effective tax rate of 144% for the nine months ended September 30, 2022 compared to effective tax rate of 59% for the nine months ended September 30, 2021. The difference between the Company’s effective tax rate and the U.S. federal statutory rate was due to the result of foreign income taxed at different rates and the provision for a full valuation allowance in respect of tax benefits from carry forward tax losses due to the uncertainty of the realization of such tax benefits.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

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+ Details

SIGNIFICANT ACCOUNTING POLICIES - Allowance for CA losses (ALCAL) (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Financing Receivable, Allowance for Credit Loss [Roll Forward]
ALCAL balance, beginning	$ 2,426	$ 1,587
Provision for ALCAL	1,584	9,296
Recoveries for ALCAL	(827)	(5,056)
CA receivables charged off	(2,059)	(654)
ALCAL balance, ending	3,629	$ 5,173
Adoption of new accounting standard
Financing Receivable, Allowance for Credit Loss [Roll Forward]
ALCAL balance, beginning	$ 2,505
Minimum
Financing Receivable, Allowance for Credit Loss [Line Items]
Percentage of loss rate to the allowance for CA losses	0.70%	2.79%
Maximum
Financing Receivable, Allowance for Credit Loss [Line Items]
Percentage of loss rate to the allowance for CA losses	1.60%	2.84%

TRANSACTION COSTS (Tables)

9 Months Ended

Sep. 30, 2022

TRANSACTION COSTS.

Schedule of composition of transaction costs, grouped by major classifications


	Three Months Ended				Nine months ended
	September 30,				September 30,
	2022		2021		2022		2021
Bank and processor fees	$	21,222	$	19,335	$	61,746	$	55,637
Network fees		3,160		3,780		10,094		6,123
Chargebacks and operational losses		1,624		631		2,906		2,382
Card costs		526		728		1,398		1,528
Capital advance costs, net of recoveries		987		(235)		2,093		5,546
Other		467		431		1,536		2,130
Total transaction costs	$	27,986	$	24,670	$	79,773	$	73,346

INCOME TAXES (Details)	9 Months Ended
INCOME TAXES (Details)	Sep. 30, 2022	Sep. 30, 2021
INCOME TAXES
Effective income tax rate	144.00%	59.00%

OTHER PAYABLES

9 Months Ended

Sep. 30, 2022

OTHER PAYABLES

OTHER PAYABLES

NOTE 7 - OTHER PAYABLES

Composition of other payables, grouped by major classifications, is as follows:


	September 30,		December 31,
	2022		2021
Employee related compensation	$	54,501	$	47,007
Commissions payable		11,810		10,712
Accrued expenses		9,450		10,661
Lease liability		9,067		9,290
Other		2,160		1,704
Total other payables	$	86,988	$	79,374

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN REDEEMABLE PREFERRED STOCK, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND SHAREHOLDERS EQUITY - USD ($) $ in Thousands	Redeemable convertible preferred stock Preferred Stock	Redeemable preferred stock Preferred Stock	Common Stock	Additional paid-in capital	Accumulated other comprehensive income (loss)	Accumulated deficit Adoption of new accounting standard	Accumulated deficit	Adoption of new accounting standard	Total
Beginning balance, preferred stock at Dec. 31, 2020	$ 154,800	$ 10,735
Beginning balance, preferred stock (in shares) at Dec. 31, 2020	209,529,798	3,500
Beginning balance at Dec. 31, 2020			$ 486	$ 79,706	$ 4,174		$ (60,067)		$ 24,299
Beginning balance (in shares) at Dec. 31, 2020			48,608,176
Reverse Recapitalization transaction	$ (154,800)		$ 2,498	189,056					191,554
Reverse Recapitalization transaction (in shares)	(209,529,798)		249,792,546
PIPE financing			$ 300	279,885					280,185
PIPE financing (in shares)			30,000,000
Redemption of Redeemable Preferred Stock		$ (10,735)		(29,069)					(29,069)
Redemption of Redeemable Preferred Stock (in shares)		(3,500)
Exercise of options			$ 104	17,566					17,670
Exercise of options (in shares)			10,388,231
Stock-based compensation				23,763					23,763
Deferred consideration related to acquisition of Optile			$ 2	(2)
Deferred consideration related to acquisition of Optile (in shares)			218,798
Other comprehensive income (loss), net of tax					(1,393)				(1,393)
Net income (loss)							(15,085)		(15,085)
Ending balance at Sep. 30, 2021			$ 3,390	560,905	2,781		(75,152)		491,924
Ending balance (in shares) at Sep. 30, 2021			339,007,751
Beginning balance at Jun. 30, 2021			$ 3,384	550,952	3,436		(75,989)		481,783
Beginning balance (in shares) at Jun. 30, 2021			338,351,977
Exercise of options			$ 4	1,320					1,324
Exercise of options (in shares)			436,976
Stock-based compensation				8,635					8,635
Deferred consideration related to acquisition of Optile			$ 2	(2)
Deferred consideration related to acquisition of Optile (in shares)			218,798
Other comprehensive income (loss), net of tax					(655)				(655)
Net income (loss)							837		837
Ending balance at Sep. 30, 2021			$ 3,390	560,905	2,781		(75,152)		491,924
Ending balance (in shares) at Sep. 30, 2021			339,007,751
Beginning balance at Dec. 31, 2021			$ 3,404	575,470	2,253	$ (2,505)	(94,054)	$ (2,505)	487,073
Beginning balance (in shares) at Dec. 31, 2021			340,384,157
Issuance of shares in connection with stock-based compensation plan			$ 98	15,185					15,283
Issuance of shares in connection with stock-based compensation plan (in shares)			9,809,530
Stock-based compensation				39,132					39,132
Other comprehensive income (loss), net of tax					(4,516)				(4,516)
Net income (loss)							(1,819)		(1,819)
Ending balance at Sep. 30, 2022			$ 3,502	629,787	(2,263)		(98,378)		532,648
Ending balance (in shares) at Sep. 30, 2022			350,193,687
Beginning balance at Jun. 30, 2022			$ 3,464	611,997	(605)		(71,926)		542,930
Beginning balance (in shares) at Jun. 30, 2022			346,439,294
Exercise of options			$ 38	3,935					3,973
Issuance of shares in connection with stock-based compensation plan (in shares)			3,754,393
Stock-based compensation				13,855					13,855
Other comprehensive income (loss), net of tax					(1,658)				(1,658)
Net income (loss)							(26,452)		(26,452)
Ending balance at Sep. 30, 2022			$ 3,502	$ 629,787	$ (2,263)		$ (98,378)		$ 532,648
Ending balance (in shares) at Sep. 30, 2022			350,193,687

DEBT

9 Months Ended

Sep. 30, 2022

DEBT

DEBT

NOTE 6 – DEBT

On October 28, 2021, Payoneer Early Payments Inc. (“PEPI”), a wholly-owned second tier subsidiary of the Company and its subsidiary (the “Borrower”) entered into a Receivables and Loan Security Agreement (the “Warehouse Facility”) with Viola Credit VI, L.P., Viola Credit Alternative Lending FNX SPV, L.P. (the “Lenders”) and Viola Credit Alternative Lending Management 2018 L.P. (collectively, the “Parties”) for the purpose of external financing of Capital Advance activity. The Company notes that the Lenders are related parties through the Company’s Board of Directors’ chairman’s ownership interest in the Lenders. Refer to Note 14 for further information regarding related party considerations.

In accordance with the Warehouse Facility agreement, the Lenders will make available to the Company an initial committed amount of $25,000, which may be increased at the request of the Company, and with the consent of the Lenders, in $25,000 increments up to $100,000. The associated borrowings will be secured by the assets of the Borrower, which consist primarily of merchant cash advances as well as a pledge of the equity of the Borrower. The recourse under the Warehouse Facility agreement is limited to Borrower's assets, and no other Payoneer entity guarantees repayment by the Borrower.

The Warehouse Facility agreement stipulates a borrowing base calculated at an advance rate of 80% out of the eligible portfolio outstanding receivables balance and that borrowings under the facility bear interest as follows: greater of 0.25% or LIBOR plus:

●

9.00% per annum if the commitment amount is $25,000;

●

7.75% per annum if the commitment amount is $50,000;

●

7.50% per annum if the commitment amount is $75,000;

●

7.00% per annum if the commitment amount is $100,000.

On June 8, 2022, the Warehouse Facility agreement was amended to create a condition that the total interest rate, calculated as the sum per above, shall not exceed 10.5% per annum for all outstanding balances.

The revolving period of the facility is 36 months from the closing date and the maturity date is 42 months from the date the Warehouse Facility agreement was entered into.

The Company recorded expenses included in transaction cost in the total amount of $384 and $942 for the three and nine months ended September 30, 2022, respectively. As of September 30, 2022, the outstanding associated balance was $15,747 with $133 of accrued expenses included in Other payables. As of December 31, 2021, the outstanding associated balance was $13,665 with $128 of accrued expenses included in Other payables.

The Warehouse Facility agreement includes certain affirmative and negative covenants that must be maintained by the Company and includes certain financial measures such as minimum tangible equity and minimum unrestricted cash at the Company level. As of September 30, 2022 and December 31, 2021, the Company was in compliance with all applicable covenants.

As of September 30, 2022 and December 31, 2021, the fair value of the debt approximates the book value due to the short time span between initiation and balance sheet date with the outstanding balance classified as Level 3 in the fair value leveling hierarchy as the inputs into the valuation are not observable.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-URI http://asc.fasb.org/topic&trid=2208564

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (h)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (g)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1E
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495348-112611

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (i)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

+ Details

OTHER CURRENT ASSETS (Tables)

9 Months Ended

Sep. 30, 2022

OTHER CURRENT ASSETS

Schedule of composition of other current assets

Composition of other current assets, grouped by major classifications, is as follows:


	September 30,		December 31,
	2022		2021
Prepaid expenses	$	15,425	$	9,598
Income receivable		8,331		9,825
Prepaid income taxes		7,982		2,789
Other		3,546		2,812
Total other current assets	$	35,284	$	25,024

WARRANTS (Tables)

9 Months Ended

Sep. 30, 2022

WARRANTS.

Schedule of changes in fair value of warrant liabilities


	Warrant
	Liability
Fair value as of December 31, 2021	$	59,877
Change in fair value		(28,932)
Fair value as of September 30, 2022	$	30,945


Initial measurement as of June 25, 2021	$	71,701
Change in fair value		(23,397)
Fair value as of September 30, 2021	$	48,304

COMMITMENTS AND CONTINGENCIES (Details) - CNBV and Bank of Mexico $ in Thousands	9 Months Ended
	Sep. 30, 2022 USD ($)
Loss Contingencies [Line Items]
Maximum amount of exposure	$ 2,250
Loss Contingency, Estimated Recovery from Third Party	$140

STOCK-BASED COMPENSATION - Summary of Stock Option Activity (Details) - Stock options	9 Months Ended
	Sep. 30, 2022 $ / shares shares
Options to purchase shares of common stock activity
Outstanding at December 31, 2021	44,940,169
Granted	500,000
Exercised	(7,603,954)
Forfeited	(1,900,412)
Outstanding at March 31, 2022	35,935,803
Exercisable at March 31, 2022	28,035,432
Weighted average exercise price \| $ / shares	$ 4.46

STOCK-BASED COMPENSATION - Summary of RSU activity (Details) - USD ($) $ in Thousands		9 Months Ended
	Jul. 01, 2022	Sep. 30, 2022
RSUs activity
Fair value of awards granted		$ 15,283
Chief Executive Officer [Member]
RSUs activity
Fair value of awards granted	$ 14,534
Restricted stock units
RSUs activity
Outstanding December 31, 2021		9,725,027
Awarded		18,153,187
Vested		(2,194,649)
Forfeited		(1,804,219)
Outstanding March 31, 2022		23,879,346
Vesting period (in years)		4 years

SIGNIFICANT ACCOUNTING POLICIES - Capital Advance receivable, net (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
SIGNIFICANT ACCOUNTING POLICIES
CA receivable, gross, beginning balance	$ 56,101	$ 67,682
CA extended to customers	146,439	255,758
Change in revenue receivables	(129)	205
CA collected from customers	(163,395)	(270,520)
Charge-offs, net of recoveries	(2,059)	(654)
CA receivable, gross, ending balance	36,957	52,471
Allowance for CA losses	(3,629)	(5,173)
CA receivable, net, ending balance	$ 33,328	$ 47,298

GOODWILL AND INTANGIBLE ASSETS, NET (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2022 USD ($)
Goodwill [Roll Forward]
Beginning balance	$ 21,127
Foreign Currency Translation Adjustments	(2,888)
Ending balance	$ 18,239

SIGNIFICANT ACCOUNTING POLICIES - Revenue recognition - Deferred Customer Acquisition Costs (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
SIGNIFICANT ACCOUNTING POLICIES
Capitalized Contract Cost, Amortization Period	1 year 9 months 18 days
Capitalized Contract Cost, Impairment Loss	$ 0	$ 0
Opening balance	11,366	8,976
Additions to deferred customer acquisition costs	9,002	7,930
Amortization of deferred customer acquisition costs	(9,365)	(6,442)
Ending balance	$ 11,003	$ 10,464

SIGNIFICANT ACCOUNTING POLICIES (Policies)

9 Months Ended

Sep. 30, 2022

SIGNIFICANT ACCOUNTING POLICIES

Principles of consolidation and basis of presentation:

a. Principles of consolidation and basis of presentation:

The accompanying condensed consolidated financial statements include the accounts of Payoneer Global Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Investments in an entity where we have the ability to exercise significant influence, but not control, over the investee are accounted for using the equity method of accounting. For such investments, our share of the investee’s results of operations is shown within Share in losses of associated company on our condensed consolidated statements of income and our investment balance as an investment in associated company on our condensed consolidated balance sheets.

The consolidated interim financial information herein is unaudited; however, such information reflects all adjustments (consisting of normal, recurring adjustments and except for the Reverse Recapitalization), which are, in the opinion of management, necessary for a fair statement of results for the interim period. The results of operations for the three and nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the full year. The year-end condensed balance sheet data was derived from audited financial statements for the year ended December 31, 2021 but does not include all disclosures required by accounting principles generally accepted in the United States of America. These unaudited financial statements should be read in conjunction with the audited consolidated financial statements and related notes thereto of Payoneer Global Inc. and Legacy Payoneer and its subsidiaries.

Accounting principles:

b. Accounting principles:

The condensed consolidated financial statements are prepared in accordance with Generally Accepted Accounting Principles (“GAAP”) in the United States of America (hereafter - U.S. GAAP).

Use of estimates in the preparation of financial statements:

c. Use of estimates in the preparation of financial statements:

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include, but are not limited to, share-based compensation, revenue recognition, valuation allowance on deferred taxes, contingencies, transaction loss provision and allowance for CA losses.

Capital Advance (CA) receivable, net:

d. Capital Advance (CA) receivable, net:

The Company enters into transactions with pre-qualified sellers in which the Company purchases a designated amount of future receivables for an upfront cash purchase price.

During the nine months ended September 30, 2022 and 2021, the Company has purchased and collected the following principal amounts associated with CAs:



	September 30,
	2022		2021
Beginning CA receivables, gross	$	56,101	$	67,682
CA extended to customers		146,439		255,758
Change in revenue receivables		(129)		205
CA collected from customers		(163,395)		(270,520)
Charge-offs, net of recoveries		(2,059)		(654)
Ending CA receivables, gross	$	36,957	$	52,471
Allowance for CA losses		(3,629)		(5,173)
CA receivables, net	$	33,328	$	47,298

The outstanding gross balance at September 30, 2022 consists of the following current and overdue amounts:


			1‑30 days	30‑60	60‑90	Above 90
Total		Current	overdue	overdue	overdue	overdue
$	36,957	34,532	606	343	305	1,171

The outstanding gross balance at December 31, 2021 consists of the following current and overdue amounts:


			1‑30 days	30‑60	60‑90	Above 90
Total		Current	overdue	overdue	overdue	overdue
$	56,101	53,150	964	704	163	1,120

The following are current and overdue balances from above that are segregated into the timing of expected collections at September 30, 2022:


			Due in less	Due in 30‑60	Due in 60‑90	Due in more
Total		Overdue	than 30 days	days	days	than 90 days
$	36,957	2,425	4,358	11,529	12,268	6,377

The following are current and overdue balances from above that are segregated into the timing of expected collections at December 31, 2021:


			Due in less	Due in 30‑60	Due in 60‑90	Due in more
Total		Overdue	than 30 days	days	days	than 90 days
$	56,101	2,951	9,511	12,457	23,008	8,174

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (continued)

d. Capital Advance (CA) receivable, net (continued):

Beginning in 2022, allowance for CA losses is primarily based on expectations of credit losses based on historical lifetime loss data as well as macroeconomic forecasts applied to the portfolio, which is segmented by programs. Loss rates are generated using historical loss data for each portfolio and are applied to segments of each portfolio. We then apply macroeconomic factors such as market unemployment rate, current and forecasted GDP, S&P yield and inflation rate, which are sourced externally, using a single scenario that we believe is most appropriate to the economic conditions applicable to a particular period. Expected credit loss, inclusive of historical loss data and macroeconomic factors, are applied to the principal amount of our CA receivables.

Prior to 2022, the Company had implemented a risk-based methodology that was used to estimate future losses based on historical loss experience as well as the qualitative judgment when historical loss data was not available. For product offerings with sufficient historical loss experience, the Company developed loss estimates based on receivable balance attributes such as account payment status, percentage of collections per day, and length of time from advance to collection. Based on these attributes, a historical loss rate is applied to calculate the allowance for CA losses. For product offerings that did not have significant historical loss data to develop a historical loss percentage, the Company estimated losses by evaluating portfolio factors such as average balance outstanding by customer as well as creating specific identification provisions for known collection risks.

As of September 30, 2022, the Company applied a range of loss rates to the CA portfolio of 0.7% to 1.6% for the allowance for CA losses. As of September 30, 2021, the Company applied a range of loss rates to the CA portfolio of 2.79% to 2.84%.

Below is a rollforward for the allowance for CA losses (“ALCAL”) for the nine months ended September 30, 2022 and 2021:


	September 30,
	2022		2021
Beginning balance	$	2,426	$	1,587
Adjustment for adoption of new accounting standard		2,505		—
Provisions		1,584		9,296
Recoveries		(827)		(5,056)
Charge-offs		(2,059)		(654)
Ending balance	$	3,629	$	5,173

Revenue:

e. Revenue:

Entity-wide disclosure

We determine operating segments based on how our Chief Operating Decision Maker (“CODM”) manages the business, makes operating decisions around the allocation of resources, and evaluates operating performance. The CODM are the Company’s Co- Chief Executive Officers, who review our operating results on a consolidated basis. We operate in one segment and have one reportable segment. Based on the information provided to and reviewed by our CODM, we believe that the nature, amount, timing, and uncertainty of our revenue and cash flows and how they are affected by economic factors are most appropriately depicted through our primary geographical markets.

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (continued)

e. Revenue (continued):

The following table presents our revenue disaggregated by primary geographical market where revenues are attributable to the country in which the billing address of the customer is located.


	Three months ended				Nine months ended
	September 30,				September 30,
	2022		2021		2022		2021
Primary geographical markets
Greater China⁽¹⁾	$	50,162	$	39,412	$	139,988	$	116,439
United States		20,675		16,731		58,985		38,100
All other countries⁽²⁾		88,080		66,508		245,092		179,645
Total revenues	$	158,917	$	122,651	$	444,065	$	334,184

(1)	Greater China is inclusive of Mainland China, Hong Kong and Taiwan

(2)	No single country included in the other countries’ category generated more than 10% of total revenue

The company did not have any customers during the three and nine months ended September 30, 2022 and 2021 that individually contributed greater than 10% of revenue, respectively.

Disaggregation of revenue

The following table presents revenue recognized from contracts with customers as well as revenue from other sources, consisting of interest income:


	Three months ended September 30,				Nine months ended September 30,
	2022		2021		2022		2021
Revenue recognized at a point in time	$	134,394	$	112,431	$	395,400	$	312,199
Revenue recognized over time		9,477		9,580		29,267		20,171
Revenue from contracts with customers		143,871		122,011		424,667		332,370
Revenue from other sources		15,046		640		19,398		1,814
Total revenues	$	158,917	$	122,651	$	444,065	$	334,184

Customer acquisition costs

The Company recognizes an asset for incremental costs to obtain a contract such as sales commissions and other customer incentives. The asset is amortized on a systematic basis over the expected customer relationship period, which is estimated to be 1.8 years and is consistent with the pattern of recognition of the associated revenue.

The Company periodically reviews these deferred customer acquisition costs to determine whether events or changes in circumstances have occurred that could impact the period of benefit. There were no impairment losses recorded during the periods presented. The following table represents a rollforward of deferred customer acquisition costs for the nine months ended:


	September 30,
	2022		2021

Opening balance	$	11,366	$	8,976
Additions to deferred customer acquisition costs		9,002		7,930
Amortization of deferred customer acquisition costs		(9,365)		(6,442)
Ending balance	$	11,003	$	10,464

Recently issued accounting pronouncements:

f. Recently issued accounting pronouncements:

As an emerging growth company (“EGC”), the Jumpstart Our Business Startups Act (“JOBS Act”) allows the Company to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. The Company has elected to use this extended transition period under the JOBS Act until such time the Company no longer meets the definition of EGC. The adoption dates referenced below reflect this election, except for permitted early adoption upon the Company’s election. The Company will become a large accelerated filer on the last day of its fiscal year 2022 and, therefore, the company will no longer qualify as an EGC. The anticipated adoption dates of standards issued, but not yet adopted reflect this upcoming change in status.

Financial Accounting Standards Board (“FASB”) standards adopted during 2022

In 2016, the FASB issued new guidance on the measurement of credit losses on financial instruments. Credit losses on loans, trade and other receivables, held-to-maturity debt securities and other instruments will reflect the Company’s current estimate of the expected credit losses (“CECL”). CECL requires loss estimates for the remaining estimated life of the financial instrument using historical experience, current conditions, and reasonable and supportable forecasts. Generally, the Company expected that CECL will result in the earlier recognition of allowances for losses compared to the current approach of estimating probable incurred losses. The Company is required to apply the provisions of this guidance as a cumulative effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. The Company early adopted the new guidance effective January 1, 2022. For additional information, refer to Note 2d.

In 2020, the FASB issued guidance simplifying the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity. In addition to other changes, this standard amends ASC 470-20, “Debt with Conversion and Other Options,” by removing the accounting models for instruments with beneficial conversion features and cash conversion features. The standard also amends ASC 260, “Earnings Per Share” addressing the impacts of these instruments. The guidance is effective for the fiscal year beginning after December 15, 2023. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Company early adopted this guidance effective January 1, 2022 and the impact of the adoption on the consolidated financial statements was immaterial.

FASB Standards issued, but not adopted as of September 30, 2022

In 2020, the FASB issued amended guidance that provides transition relief for the accounting impact of reference rate reform. For a limited duration, this guidance provides optional expedients and exceptions for applying GAAP to certain contract modifications, hedging relationships, and other transactions that will be impacted by a reference rate expected to be discontinued due to reference rate reform. The amended guidance is effective through December 31, 2022. The Company does not expect reference rate reform to have a material impact on the Company’s financial statements.

- Definition

Disclosure of accounting policy for financing receivable.

+ References + Details

OTHER PAYABLES (Tables)

9 Months Ended

Sep. 30, 2022

OTHER PAYABLES

Schedule of composition of other payables, grouped by major classifications


	September 30,		December 31,
	2022		2021
Employee related compensation	$	54,501	$	47,007
Commissions payable		11,810		10,712
Accrued expenses		9,450		10,661
Lease liability		9,067		9,290
Other		2,160		1,704
Total other payables	$	86,988	$	79,374

TRANSACTION COSTS

9 Months Ended

Sep. 30, 2022

TRANSACTION COSTS

TRANSACTION COSTS

NOTE 11 - TRANSACTION COSTS

Composition of transaction costs, grouped by major classifications, is as follows:


	Three Months Ended				Nine months ended
	September 30,				September 30,
	2022		2021		2022		2021
Bank and processor fees	$	21,222	$	19,335	$	61,746	$	55,637
Network fees		3,160		3,780		10,094		6,123
Chargebacks and operational losses		1,624		631		2,906		2,382
Card costs		526		728		1,398		1,528
Capital advance costs, net of recoveries		987		(235)		2,093		5,546
Other		467		431		1,536		2,130
Total transaction costs	$	27,986	$	24,670	$	79,773	$	73,346

OTHER CURRENT ASSETS

9 Months Ended

Sep. 30, 2022

OTHER CURRENT ASSETS

OTHER CURRENT ASSETS

NOTE 3 - OTHER CURRENT ASSETS

Composition of other current assets, grouped by major classifications, is as follows:


	September 30,		December 31,
	2022		2021
Prepaid expenses	$	15,425	$	9,598
Income receivable		8,331		9,825
Prepaid income taxes		7,982		2,789
Other		3,546		2,812
Total other current assets	$	35,284	$	25,024

NET EARNINGS (LOSS) PER SHARE (Tables)

9 Months Ended

Sep. 30, 2022

NET EARNINGS (LOSS) PER SHARE

Schedule of basic and diluted net loss per share attributable to common stockholders


	Three Months Ended				Nine months ended
	September 30,				September 30,
	2022		2021		2022		2021
Numerator:
Net income (loss)	$	(26,452)	$	837	$	(1,819)	$	(15,085)
Less dividends and revaluation attributable to redeemable and redeemable convertible preferred stock		—		—		—		33,632
Net income (loss) attributable to common stockholders	$	(26,452)	$	837	$	(1,819)	$	(48,717)
Denominator:
Weighted average common shares outstanding —
Basic		349,740,787		339,715,405		345,359,986		156,915,380
Add:
Dilutive impact of options to purchase common stock		—		33,835,289		—		—
Dilutive impact of private warrants		—		844,691		—		—
Weighted average common shares – diluted		349,740,787		374,395,385		345,359,986		156,915,380
Net income (loss) per share attributable to common stockholders — Basic earnings (loss) per share	$	(0.08)	$	—	$	(0.01)	$	(0.31)
Diluted earnings (loss) per share	$	(0.08)	$	—	$	(0.01)	$	(0.31)

Schedule of excluded potential common shares


	Three Months Ended		Nine months ended
	September 30,		September 30,
	2022	2021	2022	2021
Options to purchase common stock	30,228,328	—	31,006,169	30,874,781
Redeemable convertible preferred stock (as converted to common stock)	—	—	—	72,237,420
Private warrants	747,744	—	702,556	844,691
Total potentially dilutive securities	30,976,072	—	31,708,725	103,956,892

SUBSEQUENT EVENT

9 Months Ended

Sep. 30, 2022

SUBSEQUENT EVENT

SUBSEQUENT EVENT

NOTE 15 – SUBSEQUENT EVENT

On October 25, 2022, the Compensation Committee of the Board of Directors approved the grant of equity awards to the Chief Platform Officer of the Company, who commenced his employment with the Company on September 19, 2022, in accordance with the terms of his employment agreement. The equity awards granted under the Company’s equity incentive plan consists of RSUs subject to certain vesting criteria including time, service and performance targets.

SIGNIFICANT ACCOUNTING POLICIES (Tables)

9 Months Ended

Sep. 30, 2022

SIGNIFICANT ACCOUNTING POLICIES

Schedule of purchased and collected principal amounts associated with Capital Advance (CA) receivables

During the nine months ended September 30, 2022 and 2021, the Company has purchased and collected the following principal amounts associated with CAs:



	September 30,
	2022		2021
Beginning CA receivables, gross	$	56,101	$	67,682
CA extended to customers		146,439		255,758
Change in revenue receivables		(129)		205
CA collected from customers		(163,395)		(270,520)
Charge-offs, net of recoveries		(2,059)		(654)
Ending CA receivables, gross	$	36,957	$	52,471
Allowance for CA losses		(3,629)		(5,173)
CA receivables, net	$	33,328	$	47,298

Schedule of current and overdue amounts of CAs

The outstanding gross balance at September 30, 2022 consists of the following current and overdue amounts:


			1‑30 days	30‑60	60‑90	Above 90
Total		Current	overdue	overdue	overdue	overdue
$	36,957	34,532	606	343	305	1,171

The outstanding gross balance at December 31, 2021 consists of the following current and overdue amounts:


			1‑30 days	30‑60	60‑90	Above 90
Total		Current	overdue	overdue	overdue	overdue
$	56,101	53,150	964	704	163	1,120

Schedule of current and overdue balances CAs that are segregated into the timing of expected collections

The following are current and overdue balances from above that are segregated into the timing of expected collections at September 30, 2022:


			Due in less	Due in 30‑60	Due in 60‑90	Due in more
Total		Overdue	than 30 days	days	days	than 90 days
$	36,957	2,425	4,358	11,529	12,268	6,377

The following are current and overdue balances from above that are segregated into the timing of expected collections at December 31, 2021:


			Due in less	Due in 30‑60	Due in 60‑90	Due in more
Total		Overdue	than 30 days	days	days	than 90 days
$	56,101	2,951	9,511	12,457	23,008	8,174

Schedule of rollforward for the allowance for CA losses ("ALCAL")

Below is a rollforward for the allowance for CA losses (“ALCAL”) for the nine months ended September 30, 2022 and 2021:


	September 30,
	2022		2021
Beginning balance	$	2,426	$	1,587
Adjustment for adoption of new accounting standard		2,505		—
Provisions		1,584		9,296
Recoveries		(827)		(5,056)
Charge-offs		(2,059)		(654)
Ending balance	$	3,629	$	5,173

Schedule of revenue disaggregated by primary geographical market


	Three months ended				Nine months ended
	September 30,				September 30,
	2022		2021		2022		2021
Primary geographical markets
Greater China⁽¹⁾	$	50,162	$	39,412	$	139,988	$	116,439
United States		20,675		16,731		58,985		38,100
All other countries⁽²⁾		88,080		66,508		245,092		179,645
Total revenues	$	158,917	$	122,651	$	444,065	$	334,184

(1)	Greater China is inclusive of Mainland China, Hong Kong and Taiwan

(2)	No single country included in the other countries’ category generated more than 10% of total revenue

Schedule of revenue recognized from contracts with customers as well as revenue from other sources


	Three months ended September 30,				Nine months ended September 30,
	2022		2021		2022		2021
Revenue recognized at a point in time	$	134,394	$	112,431	$	395,400	$	312,199
Revenue recognized over time		9,477		9,580		29,267		20,171
Revenue from contracts with customers		143,871		122,011		424,667		332,370
Revenue from other sources		15,046		640		19,398		1,814
Total revenues	$	158,917	$	122,651	$	444,065	$	334,184

Schedule of deferred customer acquisition costs


	September 30,
	2022		2021

Opening balance	$	11,366	$	8,976
Additions to deferred customer acquisition costs		9,002		7,930
Amortization of deferred customer acquisition costs		(9,365)		(6,442)
Ending balance	$	11,003	$	10,464

TRANSACTION COSTS (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
TRANSACTION COSTS (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
TRANSACTION COSTS.
Bank and processor fees	$ 21,222	$ 19,335	$ 61,746	$ 55,637
Network fees	3,160		10,094	6,123
Network fees		3,780
Chargebacks and operational losses	1,624	631	2,906	2,382
Card costs	526	728	1,398	1,528
Capital advance costs, net of recoveries	987	(235)	2,093	5,546
Other	467	431	1,536	2,130
Total transaction costs	$ 27,986	$ 24,670	$ 79,773	$ 73,346

STOCK-BASED COMPENSATION - Stock-based compensation expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation	$ 13,525	$ 8,590	$ 38,323	$ 23,557
Other operating expenses
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation	2,626	1,860	8,289	5,486
Research and development expenses
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation	2,779	1,405	7,380	3,457
Sales and marketing expenses
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation	3,656	2,592	11,062	7,170
General and administrative expenses
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation	$ 4,464	$ 2,733	$ 11,592	$ 7,444

RELATED PARTY TRANSACTIONS

9 Months Ended

Sep. 30, 2022

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

NOTE 14 – RELATED PARTY TRANSACTIONS

As indicated in Note 6, the Company entered into a Warehouse Facility agreement with Lenders where a member of the Board of Directors has an interest. The Company has evaluated the relationship and determined that the Warehouse Facility agreement represents a related party transaction that has been entered into in the ordinary course of business. As such, the Warehouse Facility agreement was reviewed and approved as a related party transaction in accordance with the related party transaction approval process implemented by the Company.

The Company analyzed the terms of Warehouse Facility agreement and concluded that the terms represent a transaction conducted at arm’s length.

STOCK-BASED COMPENSATION

9 Months Ended

Sep. 30, 2022

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

NOTE 10 – STOCK-BASED COMPENSATION

Stock Options and RSUs

The following table summarizes the options to purchase shares of common stock activity under our equity incentive plans for the nine months ended September 30, 2022:


		Options
Outstanding at December 31, 2021		44,940,169
Granted		500,000
Exercised		(7,603,954)
Forfeited		(1,900,412)
Outstanding at September 30, 2022		35,935,803
Exercisable at September 30, 2022		28,035,432

The weighted average exercise price of the options outstanding as of September 30, 2022 was $4.46 per share.

The following table summarizes the RSUs activity under our equity incentive plans as of September 30, 2022:


		Units
Outstanding December 31, 2021		9,725,027
Awarded		18,153,187
Vested		(2,194,649)
Forfeited		(1,804,219)
Outstanding September 30, 2022		23,879,346

In the nine months ended September 30, 2022, the Company granted options and RSUs that vest over a four-year period from the grant date.

On July 1, 2022, the Board of Directors approved the grant of equity awards to the Co-Chief Executive Officer of the Company who was appointed by the Board of Directors on May 24, 2022 (effective as of May 25, 2022), in accordance with the terms of his employment agreement. The total fair value of the equity awards granted was $14,534 and the associated expense will be recognized in accordance with the applicable conditions. The equity awards granted under the Company’s equity incentive plan consists of options and RSUs subject to certain vesting criteria including time, service and performance targets.

Employee Stock Purchase Plan

The Company initiated, on May 16, 2022, the first offering period under the Company’s Employee Stock Purchase Plan (the “ESPP”), the purpose of which is to provide employees of the Company and its designated subsidiaries with an opportunity to purchase Company Common Stock at a discount through payroll deductions and to help eligible employees provide for their future security and to encourage them to remain in the employment of the Company.

Each eligible employee enrolling for any offering period under the ESPP is required to designate a whole percentage of their monthly payroll to be withheld by the Company or the designated subsidiary employing such eligible employee on each payday during the applicable offering period. The designated deduction percentage may not be less than 1% and may not be more than 15% of the employee’s salary subject to a maximum $25 per year, unless otherwise determined by the Company for any specific offering period. Any offering period is comprised of one or more 6 months’ purchase periods, at the last trading day of each (a “Purchase Date”), the Company will use the total amount deducted from each participant, subject to quantity limitations determined by the Company for such offering period, to issue such participant with such number of Company shares based on a purchase price which shall not be less than 85% of the closing sales price for a Company share on the first trading day of the applicable offering period or on the relevant Purchase Date, whichever is lower. The fair value attributable to the plan was $1,646 as of September 30, 2022 and was measured using the Monte Carlo model. The expense associated with the ESPP recognized during the three and nine months ended September 30, 2022 was $823 and $1,234, respectively.

NOTE 10 – STOCK-BASED COMPENSATION (continued)

The impact on our results of operations of recording stock-based compensation expense under the Company’s equity incentive plans, including the ESPP, were as follows:


	Three Months Ended				Nine months ended
	September 30,				September 30,
	2022		2021		2022		2021
Other operating expenses	$	2,626	$	1,860	$	8,289	$	5,486
Research and development expenses		2,779		1,405		7,380		3,457
Sales and marketing expenses		3,656		2,592		11,062		7,170
General and administrative expenses		4,464		2,733		11,592		7,444
Total stock-based compensation	$	13,525	$	8,590	$	38,323	$	23,557

WARRANTS - Changes in fair value of warrant liabilities (Details) - USD ($) $ in Thousands	3 Months Ended			9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
WARRANTS.
Fair value at beginning of period		$ 71,701		$ 59,877
Change in fair value of Warrants	$ 15,095	(23,397)	$ (11,321)	(28,932)	$ (23,397)
Fair value at end of period	$ 30,945	$ 48,304	$ 48,304	$ 30,945	$ 48,304

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 507,939	$ 465,926
Restricted cash	3,172	3,000
Customer funds	5,039,624	4,401,254
Accounts receivable, net	20,868	13,844
CA receivables, net	33,328	53,675
Other current assets	35,284	25,024
Total current assets	5,640,215	4,962,723
Non-current assets:
Property, equipment and software, net	13,551	12,140
Goodwill	18,239	21,127
Intangible assets, net	40,366	37,529
Restricted cash	4,413	5,113
Deferred taxes	4,080	4,900
Investment in associated company	6,237	7,013
Severance pay fund	1,219	1,723
Operating lease right-of-use asset	18,496	12,943
Other assets	12,655	13,541
Total assets	5,759,471	5,078,752
Current liabilities:
Trade payables	26,742	17,200
Outstanding operating balances	5,039,624	4,401,254
Other payables	86,988	79,374
Total current liabilities	5,153,354	4,497,828
Non-current liabilities:
Long-term debt from related party (refer to Notes 6 and 14 for further information)	15,747	13,665
Warrant liability	30,945	59,877
Other long-term liabilities	26,777	20,309
Total liabilities	5,226,823	4,591,679
Commitments and contingencies (Note 8)
Shareholders' equity:
Preferred stock, $0.01 par value, 380,000,000 shares authorized; no shares were issued and outstanding at September 30, 2022 and December 31, 2021.
Common stock, $0.01 par value, 3,800,000,000 and 3,800,000,000 shares authorized; 350,193,687 and 340,384,157 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively.	3,502	3,404
Additional paid-in capital	629,787	575,470
Accumulated other comprehensive income (loss)	(2,263)	2,253
Accumulated deficit	(98,378)	(94,054)
Total shareholders' equity	532,648	487,073
Total liabilities and shareholders' equity	$ 5,759,471	$ 5,078,752

GOODWILL AND INTANGIBLE ASSETS, NET

9 Months Ended

Sep. 30, 2022

GOODWILL AND INTANGIBLE ASSETS, NET

GOODWILL AND INTANGIBLE ASSETS, NET

NOTE 5 – GOODWILL AND INTANGIBLE ASSETS, NET

Goodwill

The following table presents goodwill balances and adjustments to those balances during the nine months ended September 30, 2022:


	December 31,		Goodwill	Translation	September 30,
	2021		Acquired	Adjustments	2022

Total goodwill	$	21,127	—	(2,888)	$	18,239

Intangible assets, net

Composition of intangible assets, grouped by major classifications, is as follows:


	September 30,		December 31,
	2022		2021
Internal use software	$	67,245	$	55,164
Developed technology		13,173		15,259
Intangible assets		80,418		70,423
Accumulated amortization		(40,052)		(32,894)
Intangible assets, net	$	40,366	$	37,529

Amortization expense for the three months ended September 30, 2022 and 2021 were $3,203 and $2,721 respectively, and $8,758 and $8,194 for the nine months ended September 30, 2022 and 2021, respectively. During the three months ended September 2022 and 2021 the Company recognized impairment of internal use of software in the amount of $614 and $0, respectively, and during the nine months ended September 30, 2022 and 2021, the Company recognized impairment of internal use of software in the amount of $614 and $114, respectively, due to the abandonment of specific projects.

NET EARNINGS (LOSS) PER SHARE - Anti-Dilutive effect (Details) - shares	3 Months Ended	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2022	Sep. 30, 2021
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive potential common shares	30,976,072	31,708,725	103,956,892
Options to purchase common stock and unvested RSUs
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive potential common shares	30,228,328	31,006,169	30,874,781
Redeemable preferred stock and redeemable convertible preferred stock (as converted to common stock)
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive potential common shares			72,237,420
Warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive potential common shares	747,744	702,556	844,691
Warrants and Earn-out shares excluded from computation	25,158,125
Earn-Out Shares
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Warrants and Earn-out shares excluded from computation	30,000,000

NET EARNINGS (LOSS) PER SHARE

9 Months Ended

Sep. 30, 2022

NET EARNINGS (LOSS) PER SHARE

NET EARNINGS (LOSS) PER SHARE

NOTE 13 – NET EARNINGS (LOSS) PER SHARE

The Company computes net loss per share using the two-class method required for participating securities. The two-class method requires income available to ordinary shareholders for the period to be allocated between shares of Common Stock and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed. The Company considers any issued and outstanding convertible preferred shares to be participating securities as the holders of the convertible preferred shares, as the case may be, would be entitled to dividends that would be distributed to the holders of ordinary shares, on a pro-rata basis assuming conversion of all convertible preferred shares into ordinary shares. These participating securities do not contractually require the holders of such shares to participate in the Company’s losses. As such, net loss for the three and nine month period ended September 30, 2022 as well as the nine months ended September 30, 2021 presented was not allocated to the Company’s participating securities.

The Company’s basic net loss per share is calculated by dividing net loss attributable to ordinary shareholders by the weighted-average number of shares of ordinary shares outstanding for the period, without consideration of potentially dilutive securities. The diluted net loss per share is calculated by giving effect to all potentially dilutive securities outstanding for the period using the treasury share method or the if-converted method based on the nature of such securities. Diluted net loss per share is the same as basic net loss per share in periods when the effects of potentially dilutive shares of ordinary shares are anti-dilutive. The Earn-Out Shares (as such term is defined in the Reorganization Agreement) which were subject to the occurrence of certain conditions, were excluded from the diluted net loss per share calculation for the three and nine month period ended September 30, 2022, because the Earn-Out Shares conditions were not met at the end of the reporting period.

NOTE 13 – NET EARNINGS (LOSS) PER SHARE (continued)

Basic and diluted net loss per share attributable to common stockholders was calculated as follows:


	Three Months Ended				Nine months ended
	September 30,				September 30,
	2022		2021		2022		2021
Numerator:
Net income (loss)	$	(26,452)	$	837	$	(1,819)	$	(15,085)
Less dividends and revaluation attributable to redeemable and redeemable convertible preferred stock		—		—		—		33,632
Net income (loss) attributable to common stockholders	$	(26,452)	$	837	$	(1,819)	$	(48,717)
Denominator:
Weighted average common shares outstanding —
Basic		349,740,787		339,715,405		345,359,986		156,915,380
Add:
Dilutive impact of options to purchase common stock		—		33,835,289		—		—
Dilutive impact of private warrants		—		844,691		—		—
Weighted average common shares – diluted		349,740,787		374,395,385		345,359,986		156,915,380
Net income (loss) per share attributable to common stockholders — Basic earnings (loss) per share	$	(0.08)	$	—	$	(0.01)	$	(0.31)
Diluted earnings (loss) per share	$	(0.08)	$	—	$	(0.01)	$	(0.31)

Private warrants, options, RSUs, ESPP and Earn-Out Shares have been excluded from the computation of diluted net loss per share for the three and nine months period ended September 30, 2022 as their effect was anti-dilutive or the conditions were not met as of the end of the reporting period.

The Company’s potentially dilutive securities, which include stock options, preferred stock, warrants and deferred consideration related to the 2020 acquisition of Optile have been excluded from the computation of diluted net loss per share for the three and nine months ended September 30, 2021 as their effect was anti-dilutive. Therefore, the weighted average number of common shares outstanding used to calculate both basic and diluted net loss per share attributable to common stockholders is the same, as shown in the above table.

The Company excluded the following potential common shares*, presented based on weighted average amounts outstanding from the computation of diluted net earnings (loss) per share attributable to common stockholders for the periods indicated because including them would have had an anti-dilutive effect:


	Three Months Ended		Nine months ended
	September 30,		September 30,
	2022	2021	2022	2021
Options to purchase common stock	30,228,328	—	31,006,169	30,874,781
Redeemable convertible preferred stock (as converted to common stock)	—	—	—	72,237,420
Private warrants	747,744	—	702,556	844,691
Total potentially dilutive securities	30,976,072	—	31,708,725	103,956,892

*Note that 25,158,125 Warrants and 30,000,000 Earn-Out Shares have been excluded from the computation of diluted net earnings per share as their effect was anti-dilutive or the conditions were not met as of the end of the reporting period.

NET EARNINGS (LOSS) PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Numerator:
Net loss	$ (26,452)	$ 837	$ (1,819)	$ (15,085)
Less dividends and revaluation attributable to redeemable preferred stock and redeemable convertible preferred stock				33,632
Net loss attributable to common stockholders	$ (26,452)	$ 837	$ (1,819)	$ (48,717)
Denominator:
Weighted average common shares outstanding - Basic	349,740,787	339,715,405	345,359,986	156,915,380
Dilutive impact of options to purchase common stock		33,835,289
Dilutive impact of warrants		844,691
Weighted average common shares outstanding - Diluted	349,740,787	374,395,385	345,359,986	156,915,380
Net income (loss) per share attributable to common stockholders - Basic earnings (loss) per share	$ (0.08)		$ (0.01)	$ (0.31)
Diluted earnings (loss) per share	$ (0.08)		$ (0.01)	$ (0.31)

STOCK BASED COMPENSATION - Employee Stock Purchase Plan (Details) - USD ($) $ in Thousands		3 Months Ended	9 Months Ended
	May 16, 2022	Sep. 30, 2022	Sep. 30, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
ESPP offering period	6 months
ESPP minimum share price as a percentage of closing sales price	85.00%
Fair value attributable to ESPP		$ 1,646	$ 1,646
ESPP expense recognized		$ 823	$ 1,234
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
ESPP designated deduction percentage	1.00%
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
ESPP designated deduction percentage	15.00%

PROPERTY, EQUIPMENT AND SOFTWARE, NET (Tables)

9 Months Ended

Sep. 30, 2022

PROPERTY, EQUIPMENT AND SOFTWARE, NET

Schedule of composition of property, equipment and software, grouped by major classifications

Composition of property, equipment and software, grouped by major classifications, is as follows:


	September 30,		December 31,
	2022		2021
Computers, software and peripheral equipment	$	31,296	$	32,379
Leasehold improvements		9,597		8,920
Furniture and office equipment		4,466		4,074
Property, equipment and software		45,359		45,373
Accumulated depreciation		(31,808)		(33,233)
Property, equipment and software, net	$	13,551	$	12,140

SIGNIFICANT ACCOUNTING POLICIES - Capital Advance receivable, net - current and overdue amounts (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021	Sep. 30, 2021	Dec. 31, 2020
Financing Receivable, Past Due [Line Items]
Total	$ 36,957	$ 56,101	$ 52,471	$ 67,682
Current
Financing Receivable, Past Due [Line Items]
Total	34,532	53,150
1-30 days overdue
Financing Receivable, Past Due [Line Items]
Total	606	964
30-60 overdue
Financing Receivable, Past Due [Line Items]
Total	343	704
60-90 overdue
Financing Receivable, Past Due [Line Items]
Total	305	163
Above 90 overdue
Financing Receivable, Past Due [Line Items]
Total	$ 1,171	$ 1,120

Document and Entity Information	9 Months Ended
Document and Entity Information	Sep. 30, 2022 shares
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Sep. 30, 2022
Entity File Number	001-40547
Entity Registrant Name	Payoneer Global Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	86-1778671
Entity Address State Or Province	NY
Entity Address, Address Line One	150 W 30th St
Entity Address, City or Town	New York
Entity Address, Postal Zip Code	10001
City Area Code	212
Local Phone Number	600-9272
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding	350,193,687
Entity Central Index Key	0001845815
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Amendment Flag	false
Common Stock [Member]
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	PAYO
Security Exchange Name	NASDAQ
Warrants
Title of 12(b) Security	Warrants, each exercisable for one share of common stock, $0.01 par value, at an exercise price of $11.50 per share
Trading Symbol	PAYOW
Security Exchange Name	NASDAQ

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
Revenues	$ 158,917	$ 122,651	$ 444,065	$ 334,184
Transaction costs ($384 and $942 interest expense and fees associated with related party transaction during the three and nine months ended September 30, 2022, respectively; refer to Notes 6 and 14 for further information)	27,986	24,670	79,773	73,346
Other operating expenses	37,744	34,402	107,895	93,026
Research and development expenses	29,617	20,104	82,139	55,298
Sales and marketing expenses	41,081	29,589	112,370	80,430
General and administrative expenses	21,693	15,957	60,013	44,637
Depreciation and amortization	5,899	4,435	15,525	13,463
Total operating expenses	164,020	129,157	457,715	360,200
Operating loss	(5,103)	(6,506)	(13,650)	(26,016)
Financial income (expense):
Gain (loss) from change in fair value of Warrants	(15,095)	11,321	28,932	23,397
Other financial expense, net	(3,617)	(3,306)	(11,136)	(6,865)
Financial income (expense), net	(18,712)	8,015	17,796	16,532
Income (loss) before taxes on income and share of gain (loss) of associated company	(23,815)	1,509	4,146	(9,484)
Taxes on income	2,635	662	5,976	5,590
Share in gain (loss) of associated company	(2)	(10)	11	(11)
Net income (loss)	$ (26,452)	$ 837	$ (1,819)	$ (15,085)
Per share data
Net income (loss) per share attributable to common stockholders - Basic earnings (loss) per share	$ (0.08)		$ (0.01)	$ (0.31)
Diluted earnings (loss) per share	$ (0.08)		$ (0.01)	$ (0.31)
Weighted average common shares outstanding - Basic	349,740,787	339,715,405	345,359,986	156,915,380
Weighted average common shares outstanding - Diluted	349,740,787	374,395,385	345,359,986	156,915,380

SIGNIFICANT ACCOUNTING POLICIES - Capital Advance receivable, net - timing of expected collections (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021	Sep. 30, 2021	Dec. 31, 2020
Financing Receivable, Past Due [Line Items]
Total	$ 36,957	$ 56,101	$ 52,471	$ 67,682
Overdue
Financing Receivable, Past Due [Line Items]
Total	2,425	2,951
Due in less than 30 days
Financing Receivable, Past Due [Line Items]
Total	4,358	9,511
Due in 30-60 days
Financing Receivable, Past Due [Line Items]
Total	11,529	12,457
Due in 60-90 days
Financing Receivable, Past Due [Line Items]
Total	12,268	23,008
Due in more than 90 days
Financing Receivable, Past Due [Line Items]
Total	$ 6,377	$ 8,174

GENERAL OVERVIEW

9 Months Ended

Sep. 30, 2022

GENERAL OVERVIEW

GENERAL OVERVIEW

NOTE 1 – GENERAL OVERVIEW

Unless otherwise noted herein, “we”, “us”, “our”, “Payoneer”, and the “Company” refer to Payoneer Inc. for the period prior to the Closing Date (as defined below) and to Payoneer Global Inc. for the period thereafter.

On June 25, 2021 (the “Closing Date”), FTAC Olympus Acquisition Corporation (“FTOC”), consummated the previously announced merger pursuant to the Agreement and Plan of Reorganization (the “Reorganization Agreement”), dated February 3, 2021, as amended, by and among FTOC, Payoneer Inc. (“Legacy Payoneer”), New Starship Parent Inc., a Delaware corporation (“New Starship”), Starship Merger Sub I Inc., a Delaware corporation and a direct, wholly owned subsidiary of New Starship (“First Merger Sub”), Starship Merger Sub II Inc., a Delaware corporation and a direct, wholly owned subsidiary of New Starship (“Second Merger Sub”). Pursuant to the terms of the Reorganization Agreement, a transaction between FTOC and Legacy Payoneer was effected through the merger of First Merger Sub with and into FTOC and through a merger of Second Merger Sub with and into Legacy Payoneer (the “Reverse Recapitalization”). On the Closing Date, and in connection with the closing of the Reverse Recapitalization, New Starship became the combined company and changed its name to Payoneer Global Inc. (the “Company”). Legacy Payoneer was deemed the accounting acquirer in the Reverse Recapitalization based on an analysis of the criteria outlined in Accounting Standards Codification (“ASC”) 805. This determination was primarily based on Legacy Payoneer’s stockholders prior to the Reverse Recapitalization having a majority of the voting interests in the combined company, Legacy Payoneer’s operations comprising the ongoing operations of the combined company, Legacy Payoneer’s board of directors comprising a majority of the board of directors of the combined company, Legacy Payoneer’s senior management comprising the senior management of the combined company and the assets and revenue of Legacy Payoneer were greater than those of FTOC. As FTOC does not meet the definition of a “business” for accounting purposes, the Reverse Recapitalization was treated as the equivalent of Legacy Payoneer issuing stock for the net assets of FTOC, accompanied by a recapitalization. The net assets of FTOC are stated at historical cost, with no goodwill or other intangible assets recorded.

While FTOC was the legal acquirer in the Reverse Recapitalization because Legacy Payoneer was deemed the accounting acquirer, the historical financial statements of Legacy Payoneer became the historical financial statements of the combined company upon the consummation of the Reverse Recapitalization. As a result, the financial statements included in this report reflect (i) the historical operating results of Legacy Payoneer prior to the Reverse Recapitalization; (ii) the combined results of the Company and Legacy Payoneer following the closing of the Reverse Recapitalization; (iii) the assets and liabilities of Legacy Payoneer at their historical cost; and (iv) the Company’s equity structure for all periods presented.

In accordance with guidance applicable to these circumstances, the equity structure has been retroactively adjusted in all comparative periods up to the Closing Date, to reflect the number of shares of the Company’s common stock, $0.01 par value per share issued to Legacy Payoneer’s stockholders in connection with the Reverse Recapitalization transaction. As such, the shares and corresponding capital amounts and earnings per share related to Legacy Payoneer redeemable convertible preferred stock and common stock prior to the Reverse Recapitalization have been retroactively restated as shares reflecting the exchange ratio established pursuant to the Reorganization Agreement. In conjunction with the Reverse Recapitalization, the Company’s Common Stock underwent a 1-for-1.88 conversion. Note that the condensed consolidated financial statements give retroactive effect as though the conversion of the Company’s Common Stock occurred for all periods presented, without any change in the par value per share.

Beginning in January 2020, the COVID-19 pandemic impacted our teams, customers, and supply chains. Starting in March 2020, due to broader travel restrictions, global travel and tourism slowed, negatively impacting our travel customer base. Furthermore, the Federal Reserve cut interest rates to zero in mid-March 2020, negatively impacting our interest income revenues associated with underlying customer accounts. During 2022, global travel and tourism increased as many travel restrictions were lifted, positively impacting our travel customer base. Additionally, during 2022 the U.S. Federal Reserve raised the benchmark interest rate by 300 basis points to combat rising inflation, which is widely expected to slow economic growth and consumption globally. Higher interest rates positively impact our interest income revenues associated with underlying customer accounts which slowing growth and consumption may negatively impact the sales growth of our customers and the resulting volume we generate. There are many uncertainties regarding the current trajectory of travel growth, interest rates, economic growth and other macroeconomic factors.

NOTE 1 – GENERAL OVERVIEW (continued)

During 2022, a geopolitical and armed conflict between Ukraine and Russia culminated in several countries, including the US, imposing economic sanctions on Russia, Belarus, and certain territories in Ukraine, including on certain Russian and Belarussian banks and entities. Payoneer provides services to customers in Ukraine and in jurisdictions that are or may be impacted by these economic sanctions. We are continually acting to comply with imposed sanctions and as we continue to reduce our payment services to Russia and Belarus customers, we are monitoring and assessing the impact the conflict may have on our results of operations. For the three and nine months ended September 30, 2022, Ukraine, Russia and Belarus, combined, accounted for slightly less than 10% of our revenue for each such period, of which Russia and Belarus, combined, accounted for less than 3% of our revenue for each such period. There was immaterial impact on revenue from Ukraine, Russia and Belarus during the three and nine months ended September 30, 2022 as compared to the three and nine months ended September 30, 2021. Further escalation of the conflict may have a material effect on our results of operations.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - Reconciliation of cash, cash equivalents, restricted cash and customer funds - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2022
Reconciliation of cash, cash equivalents, restricted cash and customer funds
Cash and cash equivalents	$ 448,955	$ 507,939
Restricted cash	7,795	7,585
Customer funds, excluding funds in transit	3,648,319	5,005,659
Total cash, cash equivalents, restricted cash and customer funds shown in the consolidated statements of cash flows	4,105,069	5,521,183
Customer funds in transit	58,618	$ 33,965
Supplemental schedule about Reverse Recapitalization
Cash held by FTOC and cash related to FTOC trust, net of redemptions	574,961
Less cash consideration paid to Legacy Payoneer Shareholders	398,201
Less cash paid associated with transaction costs allocated to Reverse Recapitalization	68,117
Reverse Recapitalization financing	108,643
Cash related to PIPE	300,000
Less cash paid associated with transaction costs allocated to PIPE	19,815
PIPE financing	280,185
Net contributions from Reverse Recapitalization and PIPE financing	$ 388,828

DEBT (Details) - Receivables And Loan Security Agreement - USD ($) $ in Thousands			3 Months Ended	9 Months Ended
	Jun. 08, 2022	Oct. 28, 2021	Sep. 30, 2022	Sep. 30, 2022	Dec. 31, 2021
Debt Instrument [Line Items]
Aggregate principal amount		$ 100,000
Initial borrowing commitment		$ 25,000
Initial rate of value of underlying capital advance receivables outstanding		80.00%
Revolving maturity term		36 months
Additional payback period after revolving maturity date		42 months
Floating rate (in percent)		0.25%
Expenses included in transaction cost			$ 384	$ 942
Outstanding balance associated with related party			15,747	15,747	$ 13,665
Accrued expenses associated with related party			$ 133	$ 133	$ 128
Maximum
Debt Instrument [Line Items]
Basis spread on floating rate	10.50%
LIBOR \| Commitment amount equal to 25,000
Debt Instrument [Line Items]
Basis spread on floating rate		9.00%
LIBOR \| Commitment amount equal to 50,000
Debt Instrument [Line Items]
Basis spread on floating rate		7.75%
LIBOR \| Commitment amount equal to 75,000
Debt Instrument [Line Items]
Basis spread on floating rate		7.50%
LIBOR \| Commitment amount equal to 100,000
Debt Instrument [Line Items]
Basis spread on floating rate		7.00%

WARRANTS

9 Months Ended

Sep. 30, 2022

WARRANTS.

WARRANTS

NOTE 9 – WARRANTS

The Company has warrants that are exercisable for shares of the Company’s common stock. Warrants may only be exercised for a whole number of shares at an exercise price of $11.50. These warrants expire on June 25, 2026 or earlier if redeemed. At September 30, 2022, there were 25,158,086 warrants outstanding with a corresponding liability valued at $30,945. The warrants are considered to be a Level 1 fair value measurement due to the observability of the inputs. Note that 723,333 private placement warrants were forfeited at the close of the Reverse Recapitalization transaction.

The Warrants were accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities on our balance sheet. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the consolidated statement of operations. The following table presents the changes in the fair value of warrant liabilities:


	Warrant
	Liability
Fair value as of December 31, 2021	$	59,877
Change in fair value		(28,932)
Fair value as of September 30, 2022	$	30,945


Initial measurement as of June 25, 2021	$	71,701
Change in fair value		(23,397)
Fair value as of September 30, 2021	$	48,304

SIGNIFICANT ACCOUNTING POLICIES - Revenue recognition - Primary Geographical Market (Details)
$ in Thousands

3 Months Ended

9 Months Ended

Sep. 30, 2022

USD ($)

Sep. 30, 2021

USD ($)

Sep. 30, 2022

USD ($)

segment

Sep. 30, 2021

USD ($)

Disaggregation of Revenue [Line Items]

Number of Operating Segments | segment

Number of Reportable Segments | segment

Total revenues

$ 158,917

$ 122,651

$ 444,065

$ 334,184

Greater China

Disaggregation of Revenue [Line Items]

Total revenues

^[1]

50,162

39,412

139,988

116,439

United States

Disaggregation of Revenue [Line Items]

Total revenues

20,675

16,731

58,985

38,100

All other countries

Disaggregation of Revenue [Line Items]

Total revenues

^[2]

$ 88,080

$ 66,508

$ 245,092

$ 179,645

[1]	Greater China is inclusive of Mainland China, Hong Kong and Taiwan
[2]	No single country included in the other countries’ category generated more than 10% of total revenue

- Definition

+ References

+ Details

PROPERTY, EQUIPMENT AND SOFTWARE, NET

9 Months Ended

Sep. 30, 2022

PROPERTY, EQUIPMENT AND SOFTWARE, NET

PROPERTY, EQUIPMENT AND SOFTWARE, NET

NOTE 4 – PROPERTY, EQUIPMENT AND SOFTWARE, NET

Composition of property, equipment and software, grouped by major classifications, is as follows:


	September 30,		December 31,
	2022		2021
Computers, software and peripheral equipment	$	31,296	$	32,379
Leasehold improvements		9,597		8,920
Furniture and office equipment		4,466		4,074
Property, equipment and software		45,359		45,373
Accumulated depreciation		(31,808)		(33,233)
Property, equipment and software, net	$	13,551	$	12,140

Depreciation expense for the three months ended September 30, 2022 and 2021 were $2,082 and $1,714, respectively, and $6,153 and $5,155 for the nine months ended September 30, 2022 and 2021, respectively.

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Cash Flows from Operating Activities
Net loss	$ (1,819)	$ (15,085)
Adjustment to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	15,525	13,463
Deferred taxes	820	(175)
Stock-based compensation expenses	39,132	23,763
Share in loss (gain) of associated company	(11)	11
Gain from change in fair value of Warrants	(28,932)	(23,397)
Transaction costs allocated to Warrants		5,087
Foreign currency re-measurement loss	3,015	1,290
Changes in operating assets and liabilities:
Other current assets	(10,825)	(17,386)
Trade payables	8,753	106
Deferred revenue	(30)	524
Accounts receivables	(7,024)	5,247
CA extended to customers	(145,424)	(252,505)
CA collected from customers	163,266	271,302
Other payables	7,047	(3,542)
Other long-term liabilities	(7,250)	(4,354)
Operating lease right-of-use assets	7,862	7,006
Other assets	221	(567)
Net cash provided by operating activities	44,326	10,788
Cash Flows from Investing Activities
Purchase of property, equipment and software	(7,132)	(3,820)
Capitalization of internal use software	(10,209)	(9,670)
Severance pay fund (contributions) distributions, net	504	(445)
Customer funds in transit, net	2,895	9,396
Net cash used in investing activities	(13,942)	(4,539)
Cash Flows from Financing Activities
Proceeds from exercise of stock options	15,283	17,670
Outstanding operating balances, net	638,370	360,212
Redemption of redeemable preferred stock		(39,804)
Proceeds from Reverse Recapitalization, net		108,643
Proceeds from PIPE financing, net		280,185
Proceeds from related party facility, net	2,082
Repayment of long-term debt		(40,025)
Net cash provided by financing activities	655,735	686,881
Effect of exchange rate changes on cash and cash equivalents	(3,369)	(1,350)
Net change in cash, cash equivalents, restricted cash and customer funds	682,750	691,780
Cash, cash equivalents, restricted cash and customer funds at beginning of the period	4,838,433	3,413,289
Cash, cash equivalents, restricted cash and customer funds at end of the period	$ 5,521,183	$ 4,105,069

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Net loss	$ (26,452)	$ 837	$ (1,819)	$ (15,085)
Other comprehensive loss:
Foreign currency translation adjustments	(1,658)	(655)	(4,516)	(1,393)
Comprehensive income (loss)	$ (28,110)	$ 182	$ (6,335)	$ (16,478)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 33: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(A))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 34: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8906-108599

Reference 35: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

+ Details

SIGNIFICANT ACCOUNTING POLICIES

9 Months Ended

Sep. 30, 2022

SIGNIFICANT ACCOUNTING POLICIES

SIGNIFICANT ACCOUNTING POLICIES

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES

a. Principles of consolidation and basis of presentation:

b. Accounting principles:

The condensed consolidated financial statements are prepared in accordance with Generally Accepted Accounting Principles (“GAAP”) in the United States of America (hereafter - U.S. GAAP).

c. Use of estimates in the preparation of financial statements:

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (continued)

d. Capital Advance (CA) receivable, net:

The Company enters into transactions with pre-qualified sellers in which the Company purchases a designated amount of future receivables for an upfront cash purchase price.

During the nine months ended September 30, 2022 and 2021, the Company has purchased and collected the following principal amounts associated with CAs:



	September 30,
	2022		2021
Beginning CA receivables, gross	$	56,101	$	67,682
CA extended to customers		146,439		255,758
Change in revenue receivables		(129)		205
CA collected from customers		(163,395)		(270,520)
Charge-offs, net of recoveries		(2,059)		(654)
Ending CA receivables, gross	$	36,957	$	52,471
Allowance for CA losses		(3,629)		(5,173)
CA receivables, net	$	33,328	$	47,298

The outstanding gross balance at September 30, 2022 consists of the following current and overdue amounts:


			1‑30 days	30‑60	60‑90	Above 90
Total		Current	overdue	overdue	overdue	overdue
$	36,957	34,532	606	343	305	1,171

The outstanding gross balance at December 31, 2021 consists of the following current and overdue amounts:


			1‑30 days	30‑60	60‑90	Above 90
Total		Current	overdue	overdue	overdue	overdue
$	56,101	53,150	964	704	163	1,120

The following are current and overdue balances from above that are segregated into the timing of expected collections at September 30, 2022:


			Due in less	Due in 30‑60	Due in 60‑90	Due in more
Total		Overdue	than 30 days	days	days	than 90 days
$	36,957	2,425	4,358	11,529	12,268	6,377

The following are current and overdue balances from above that are segregated into the timing of expected collections at December 31, 2021:


			Due in less	Due in 30‑60	Due in 60‑90	Due in more
Total		Overdue	than 30 days	days	days	than 90 days
$	56,101	2,951	9,511	12,457	23,008	8,174

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (continued)

d. Capital Advance (CA) receivable, net (continued):

Below is a rollforward for the allowance for CA losses (“ALCAL”) for the nine months ended September 30, 2022 and 2021:


	September 30,
	2022		2021
Beginning balance	$	2,426	$	1,587
Adjustment for adoption of new accounting standard		2,505		—
Provisions		1,584		9,296
Recoveries		(827)		(5,056)
Charge-offs		(2,059)		(654)
Ending balance	$	3,629	$	5,173

e. Revenue:

Entity-wide disclosure

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (continued)

e. Revenue (continued):

The following table presents our revenue disaggregated by primary geographical market where revenues are attributable to the country in which the billing address of the customer is located.


	Three months ended				Nine months ended
	September 30,				September 30,
	2022		2021		2022		2021
Primary geographical markets
Greater China⁽¹⁾	$	50,162	$	39,412	$	139,988	$	116,439
United States		20,675		16,731		58,985		38,100
All other countries⁽²⁾		88,080		66,508		245,092		179,645
Total revenues	$	158,917	$	122,651	$	444,065	$	334,184

(1)	Greater China is inclusive of Mainland China, Hong Kong and Taiwan

(2)	No single country included in the other countries’ category generated more than 10% of total revenue

The company did not have any customers during the three and nine months ended September 30, 2022 and 2021 that individually contributed greater than 10% of revenue, respectively.

Disaggregation of revenue

The following table presents revenue recognized from contracts with customers as well as revenue from other sources, consisting of interest income:


	Three months ended September 30,				Nine months ended September 30,
	2022		2021		2022		2021
Revenue recognized at a point in time	$	134,394	$	112,431	$	395,400	$	312,199
Revenue recognized over time		9,477		9,580		29,267		20,171
Revenue from contracts with customers		143,871		122,011		424,667		332,370
Revenue from other sources		15,046		640		19,398		1,814
Total revenues	$	158,917	$	122,651	$	444,065	$	334,184

Customer acquisition costs


	September 30,
	2022		2021

Opening balance	$	11,366	$	8,976
Additions to deferred customer acquisition costs		9,002		7,930
Amortization of deferred customer acquisition costs		(9,365)		(6,442)
Ending balance	$	11,003	$	10,464

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (continued)

f. Recently issued accounting pronouncements:

Financial Accounting Standards Board (“FASB”) standards adopted during 2022

FASB Standards issued, but not adopted as of September 30, 2022

COMMITMENTS AND CONTINGENCIES

9 Months Ended

Sep. 30, 2022

COMMITMENTS AND CONTINGENCIES.

COMMITMENTS AND CONTINGENCIES

NOTE 8 – COMMITMENTS AND CONTINGENCIES

The Company’s business is subject to various laws and regulations in the United States and other countries from where the Company operates. Any regulatory action, tax or legal challenge against the Company for noncompliance with any regulatory or legal requirement could result in significant fines, penalties, or other enforcement actions, increased costs of doing business through adverse judgment or settlement, reputational harm, the diversion of significant amounts of management time and operational resources, and could require changes in compliance requirements or limits on the Company’s ability to expand its product offerings, or otherwise harm or have a material adverse effect on the Company’s business.

On September 28, 2021, the National Banking and Securities Commission (CNBV) and the Bank of Mexico revoked the banking license of a banking entity utilized by the Company due to the banking entity not meeting applicable capital requirements. As a result, the Company is unable to withdraw funds from the banking entity. The Company has reserved $2,250 for potential losses related to the inaccessible funds above the recovered amount. The Company applied for and recovered the maximum statutory reimbursement through the deposit insurance provided by Mexican Institute for the Protection of Banking Services (IPAB), totaling $140. The Company has made a claim in liquidation for the remaining funds; however, the percentage of the deposit that will be recovered in liquidation is not known at this time.

From time to time, the Company is involved in other disputes or regulatory inquiries that arise in the ordinary course of business. These may include suits by our customers (individually or as class actions) alleging, among other things, acting unfairly and/or not in conformity regarding pricing, rules or agreements, improper disclosure of our prices, rules, or policies or that our practices, prices, rules, policies, or customer agreements violate applicable law.

In addition to these types of disputes and regulatory inquiries, the operations of the Company are also subject to regulatory and/or legal review and/or challenges that tend to reflect the increasing global regulatory focus to which the industry in which the Company operates is subject and, when taken as a whole with other regulatory and legislative action, such actions could result in the imposition of costly new compliance burdens on the Company and may lead to increased costs and decreased transaction volume and revenue. Any claims or regulatory actions against the Company, whether meritorious or not, could be time consuming, result in costly litigation, settlement payments, damage awards (including statutory damages for certain causes of action in certain jurisdictions), fines, penalties, injunctive relief, or increased costs of doing business through adverse judgment or settlement, require the Company to change our business practices, require significant amounts of management time, result in the diversion of operational resources, or otherwise harm the business.

STOCK-BASED COMPENSATION (Tables)

9 Months Ended

Sep. 30, 2022

STOCK-BASED COMPENSATION

Schedule of options to purchase shares of common stock activity under our equity incentive plans


		Options
Outstanding at December 31, 2021		44,940,169
Granted		500,000
Exercised		(7,603,954)
Forfeited		(1,900,412)
Outstanding at September 30, 2022		35,935,803
Exercisable at September 30, 2022		28,035,432

Schedule of RSUs activity

The following table summarizes the RSUs activity under our equity incentive plans as of September 30, 2022:


		Units
Outstanding December 31, 2021		9,725,027
Awarded		18,153,187
Vested		(2,194,649)
Forfeited		(1,804,219)
Outstanding September 30, 2022		23,879,346

Schedule of stock-based compensation expense


	Three Months Ended				Nine months ended
	September 30,				September 30,
	2022		2021		2022		2021
Other operating expenses	$	2,626	$	1,860	$	8,289	$	5,486
Research and development expenses		2,779		1,405		7,380		3,457
Sales and marketing expenses		3,656		2,592		11,062		7,170
General and administrative expenses		4,464		2,733		11,592		7,444
Total stock-based compensation	$	13,525	$	8,590	$	38,323	$	23,557

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2022
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
Interest expense and fees associated with related party transaction	$ 384	$ 942

GENERAL OVERVIEW (Details)		3 Months Ended	9 Months Ended
GENERAL OVERVIEW (Details)	Jun. 25, 2021 $ / shares	Sep. 30, 2022 $ / shares	Sep. 30, 2022 $ / shares	Dec. 31, 2021 $ / shares
Common stock, par value	$ 0.01	$ 0.01	$ 0.01	$ 0.01
Exchange Ratio	0.53
Total revenues \| Geographic Concentration Risk \| Russia and Belarus
Percentage of total revenue		10.00%	10.00%
Maximum \| Total revenues \| Geographic Concentration Risk \| Russia, Belarus and Ukraine
Percentage of total revenue		3.00%	3.00%