Marqeta celebrates its initial public offering on the Nasdaq on June 9, 2021.
Source: Nasdaq
Marketa Shares fell more than 30% in extended trading Monday after the company issued weaker-than-expected guidance for the fourth quarter.
Here's how the company's performance compares to Wall Street estimates, based on a survey of analysts conducted by LSEG:
Loss per share: 6 cents adjusted vs. expected loss of 5 cents Revenue: $128 million vs. $128.1 million expected
While the third quarter results showed slight disappointment on the top and bottom, Marketa's outlook for the current period was more worrying.
The payment processing company said revenue in the fourth quarter would increase 10% to 12% from a year earlier. Analysts were expecting growth of more than 17%, according to LSEG.
Marqeta, which operates primarily as a card issuing platform, attributed the guidance error to “extreme scrutiny of the banking environment and specific changes in the customer program.” The company has been facing difficulties for some time, and its stock has now fallen by more than 80% from its peak in 2021, the year in which its shares went public. The stock is down 15% from the year before the report.
Total processing volume of $74 billion was up more than 30% from the previous year. Net revenues and gross profit increased by 18% and 24%, respectively.
Marqeta's digital commerce business sells payment technology designed to detect potential fraud and ensure funds are routed correctly. They also issue customized physical cards that resemble a credit or debit card that can be used for point-of-sale purchases.
The company is trying to break into the buy now, pay later process with a recently launched product called Marqeta Flex. The service fetches BNPL from lenders such as Confirm Or Klarna to any credit card where Mastercard and Visa are accepted.
“It's a coordination layer, but it's tied to issuance, processing, disputes and chargebacks,” CEO Simon Khalaf told CNBC at Money2020 in Las Vegas last week. “So it's not really the Wild West of BNPL. It's actually pretty well established. There's a reason why a lot of people are jumping into it.”
