Our website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.

Payments company Adyen’s shares drop more than 20% after earnings miss

by Uma
0 comment
2023 08 17T075733Z 1 LYNXMPEJ7G093 RTROPTP 4 ADYEN RESULTS 1

Payments company Adyen’s shares drop more than 20% after earnings miss

AMSTERDAM (Reuters) – Shares in Dutch payments processor Adyen NV fell by more than 20% on Thursday after first-half earnings missed analysts’ estimates and the company’s own targets.

Adyen, which provides online payment services for many of the world’s largest internet platforms and retail stores, including Netflix, Meta, Microsoft and Spotify, cited slower growth in North America and ongoing hiring costs.

Under rules that suspend trading when a major price move is expected, the start of trading in Ayden shares was delayed by around 20 minutes on Euronext which opens at 0700 GMT.

When they started trading they fell sharply and were down 22% at 1,145 euros at 0729 GMT.

“These are disappointing results, particularly the sales miss and the key question will be whether the company can quickly revert to mid-term trend growth,” JPMorgan analysts said in a note.

Earnings before interest, tax, depreciation and amortisation (EBITDA) were 320 million euros ($348 million), down 10% from a year earlier and below analyst forecasts of 386 million euros, Refinitiv data shows.

Revenue rose 21% to 739 million euros, against Adyen’s mid-term forecasts of more than 25% growth.

Adyen said there were several reasons for the miss.

“In some areas the business grew at a lower rate than anticipated,” the company’s executives said in a letter to shareholders. “This was the case for our North American net revenue … an increasingly important contributor in recent years.”

The company also cited competition in the United States, where its rivals include Stripe, Fiserv and PayPal.

Adyen’s EBITDA margin fell to 43% from 59%, which the company said was mostly because of higher wage costs as it takes on more staff.

A similar margin decline led to a sell-off in Adyen shares when the company reported full-year earnings in February.

“We are confident in the long-term benefits of building our team at an accelerated pace and consciously embrace its short-term impact,” the company said on Thursday.

Adyen maintained its medium-term targets for revenue growth above 25% and an improving EBITDA margin that it expects to reach 65% in the long term.

($1 = 0.9205 euros)


(Reporting by Toby Sterling; Editing by David Goodman, Barbara Lewis and Jane Merriman)