Adyen on Thursday reported a sharp decline in first-half sales. The news caused the company’s market value to plummet by $20 billion.
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Dutch payments company Adyen beat its half-year core profit forecast on Thursday, sending its shares up more than 5% on Thursday, driven by market share growth, slowing hiring and lower one-time charges.
While the digital payments industry faces pressure from a post-pandemic decline in consumer spending and regulatory scrutiny, Adyen has grown faster than its peers, helped by international expansion and clients like Cash App in the U.S. and Shopify in Canada.
Adyen Chief Financial Officer Ethan Tandowsky said in an interview with Reuters that Adyen’s biggest growth driver is the improvement in demand from existing customers and its ability to expand its service scope.
“Even in our most mature markets, there’s still room for growth,” Tandoski said. This applies both to cooperation with payment platforms serving small and medium-sized enterprises, and to Adyen’s more direct integrated services for large companies.
Adyen’s market share in Europe, the Middle East and Africa (EMEA) and North America is in the single digits, leaving ample room for growth in those regions, the company said.
It also pointed to winning an IKEA contract in Mexico and a new license to operate as an online payments aggregator in India as examples of its international expansion.
Its half-year core profit rose 32% to 423.1 million euros ($465.8 million), exceeding the average estimate of $413.39 million among 13 analysts surveyed by the London Stock Exchange Group (LSEG).
Net income increased by 24% year-on-year to 913.4 million euros, and the EBITDA margin expanded from 43% to 46% during the same period.
JPMorgan analysts said the results were positive given investors’ cautious stance on the stock.
French rival Worldline cut its 2024 forecast in early August, citing a sharp drop in demand in Europe, while Adyen lowered its 2026 forecast in November and said it would hire fewer people to cut costs.
Adyen said it hired 37 employees in the first half of 2024, down from 551 employees in the same period last year.
