Adyen on Thursday reported a sharp decline in first-half sales. The news caused the company’s market value to plummet by $20 billion.
Pavlo Gonchar | Sopa Images | Light Rocket | Getty Images
shares Adien Trading volumes fell earlier Thursday as the company reported slower volume growth in the third quarter.
Adyen’s shares initially failed to open Thursday after the company released its third-quarter report, but later resumed trading. The stock fell 9.8% as of 8:35 a.m. London time, hitting the bottom of the pan-European Stoxx 600 index.
Adyen’s sales growth was driven by growth in total processing volume (TPV), which increased by 32% year-on-year to €321 billion. Adyen’s TPV grew 45% in the first half of the year, after the company reported 46% year-over-year growth in the first quarter.
Citi analysts said in a research note that “weak” trading volumes on Thursday were likely to capture most of investors’ attention amid concerns about end-market weakness.
“Regardless, processing volume take-up rates are significantly higher than expected and, if sustainable, should support an acceleration in sales growth in 2025/26, while lower hiring rates should support continued margin improvement,” they wrote.
Adyen said digital processing volume increased 29% year-on-year, down from the previous quarter, due to the impact of a single high-volume customer. Blocky Cash App.
Separately, the company reported third-quarter sales growth as the Dutch payments company gained wallet share and added new customers to diversify its merchant portfolio. Adyen, whose technology allows businesses to accept payments online and in-store, reported third-quarter net revenue of 498.3 million euros ($535.5 million), up 21% year over year in constant currency.
The company’s in-store payments became more attractive in the third quarter, with its “Unified Commerce” point-of-sale terminals growing 33% year over year, and its installed base of physical payment devices increasing by 46,000 to 299,000.
Adyen also said the company expanded its hiring slightly, adding 35 new employees during the quarter. The company has been slowing hiring last year amid concerns about the pace of its investments.
Last year, shares of the Dutch payments giant A single-day drop of nearly 40% Sales worse than expected and profits fall in first half of 2023
.
Payments companies were boosted by growth in online shopping during the height of the Covid-19 pandemic.
But in recent years, companies like Adyen have faced pressure from falling consumer spending.
However, Adyen has benefited from significant growth in partnerships with North American customers, such as Cash App in the US and Shopping in Canada.
Adyen kept its guidance unchanged on Thursday, saying it expects to achieve net revenue growth of around 20% through and including 2026.
The company added that it expects its earnings before interest, taxes, depreciation and amortization to improve to a level above 50% by 2026.
Adyen said capital expenditures will remain at around 5% of net revenue.
