Adyen on Thursday reported a significant drop in first-half sales. The news caused the company’s market capitalization to drop by $20 billion.
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Adien Shares fell on Thursday after the company reported slower volume growth in the third quarter.
Adyen shares fell more than 6% on Thursday following the company’s third-quarter report, and were down as much as 11% in early trading. The stock initially failed to trade when the market opened in Amsterdam.
Adyen’s sales growth was driven by higher total processing volume (TPV), which rose 32% year-on-year to €321 billion. Adyen had reported 46% year-over-year growth in the first quarter, while TPV increased by 45% in the first half.
Citi analysts said in a research note that “weak” trading volumes are likely to get the most attention from investors on Thursday amid concerns about weakness in final markets.
“In any case, adoption rates relative to throughput are comfortably higher than expected and, if sustainable, support accelerated revenue growth in 2025/26, while lower adoption execution rates support continued margin improvement. It should support you,” they wrote.
Adyen said digital processing volume increased 29% year over year, which was lower than the previous quarter due to the impact of a single large customer. Mr. Block Cash app.
The company reported a sharp increase in sales in the third quarter as the Dutch payments company gained wallet share, added new customers and diversified its merchant mix. Adyen’s technology enables businesses to accept payments online and in-store, and net revenue for the quarter was €498.3 million ($535.5 million), up from a year earlier at constant currency. reported a 21% increase.
The company observed even stronger traction in in-store payments in the third quarter, as its installed base of physical payment devices grew by 46,000 units to 299,000, and “Unified Commerce” POS terminals increased by 46,000 to 299,000. recorded a year-on-year growth of 33%. .
Adyen also said it expanded its hiring slightly, adding 35 new people in the quarter. The company has held back on hiring over the past year amid concerns about the pace of investment.
Last year, the Dutch payments giant’s shares plummeted nearly 40% in one day as it reported lower-than-expected sales and profits for the first half of 2023.
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At the height of the coronavirus disease (Covid-19) pandemic, payment companies boosted their performance due to an increase in online shopping.
But in recent years, companies like Adyen have faced pressure from falling consumer spending.
However, Adyen does not support Cash App in the US or Shopify In Canada.
Adyen on Thursday did not change its outlook, saying it expects net revenue growth to be in the low to high 20s percent through 2026.
The company added that it expects earnings before interest, taxes, depreciation and amortization to improve to a level of over 50% by 2026. Capital spending will continue at a level of up to 5% of net revenues, Adyen said.
