Robinhood launches 24-hour trading
Fintech Headlines for May 10, 2023: Robinhood is launching 24-hour trading, Nuvei gives Ryan Reynolds a crash course in Fintech investing, and Marqeta announces layoffs and…share buybacks
US inflation rose 4.9% YoY in April, reported the Labor Deparment yesterday, which was in line with the expectations. Inflation rose 5% YoY in March and 6% in February. In the meantime, the Fintech world continued to be lots of fun:
Robinhood is launching 24-hour trading,
Nuvei gives Ryan Reynolds a crash course in Fintech investing, and
Marqeta announces layoffs and…share buybacks
Robinhood to Launch 24-Hour Trading
Robinhood (NASDAQ: HOOD) announced launching 24-hour trading on weekdays for select stocks and exchange-traded funds. This is a significant shift for the industry, as the feature allows users to trade assets around the clock, unlike traditional markets that are only open during set hours (i.e. 9:30 a.m. to 4:00 p.m. Eastern Time in the United States). The new feature is set to roll out next week, and initially will allow Robinhood users to buy whole shares of 43 of the most traded ETFs and individual stocks, such as Tesla, Amazon, and Apple. Trading hours will run from 8:00 pm ET on Sunday to 8:00 pm ET on Friday. Last year, Robinhood introduced extended trading hours, allowing its customers to trade from 7 a.m. to 8 p.m. ET.
The company also reported its first quarter 2023 results, beating revenue estimates on a strong contribution from interest income. Similarly to other brokerages, Robinhood earns a return on uninvested customers’ balances, so rising rates were a strong tailwind for the company. Total revenue increased 47.5% YoY to $441 million. Net interest revenue exceeded transaction-based revenue at $208 million compared to $207 million. The company reported a Net loss of $511 million, which was impacted by a one-time $485 million accounting charge related to Robinhood co-founders canceling their 2021 share-based compensation. Adjusted EBITDA was $115 million, compared to negative $143 million a year ago.
✔️ Robinhood Reports First Quarter 2023 Results
✔️ Robinhood Stock Rises After Earnings. Its Hottest Product Now Is Cash
✔️ Robinhood beats revenue estimates as rate hikes bolster interest income
✔️ The Robinhood 24 Hour Market is Here
✔️ Robinhood to Launch 24-Hour Trading on Weekdays in Stocks and ETFs
Nuvei Gives Ryan Reynolds a Crash Course in Fintech Investing
Nuvei (NASDAQ: NVEI), a Canadian payments company competing with the likes of Stripe and Adyen, reported its first quarter 2023 earnings. The stock plummeted by 14.32% following the earnings release. The company reported a 20% YoY increase in revenue to $256.5 million driven by… Who am I kidding?! I knew nothing about the company until a few weeks ago, when Ryan Reynolds, a Deadpool star, announced his investment in the company. I haven’t seen Deadpool either, but Ryan Reynolds made waves with his investments, including an investment in Mint Mobile (which was sold to T-Mobile for $1.35 billion), and most notably, the Wrexham football club. I mean, they even made a documentary about it, “Welcome to Wrexham”.
Pretty much the next day after Nuvei announced Reynolds as its shareholder, the company became a target of short sellers. Spruce Point Capital Management accused the company of “obscuring the extent of its crypto exposure”, as well as partnering with, and hiring from the failed cryptocurrency exchange FTX. The short seller also questioned the rationale behind the $1.3 billion acquisition of the US Fintech company Paya, which Nuvei completed in February 2023. Nuvei’s stock price is up 42% YTD, but is certainly down since the announcement of Reynolds's investment. I doubt Ryan Reynolds will ever read this, but I would like to welcome him to the world of Fintech. We’re having so much fun here!
✔️ Nuvei Announces First Quarter 2023 Results
✔️ Actor Ryan Reynolds backs Canadian payments fintech Nuvei Corp
✔️ Ryan Reynolds on recent investment in Nuvei
✔️ Nuvei Faces Short-Seller Report After Ryan Reynolds Stake
✔️ Spruce Point Capital Management Announces Investment Opinion: Releases Report and Strong Sell Research Opinion on Nuvei Corp
Marqeta Announces Layoffs…and Share Buybacks
Marqeta (NASDAQ: MQ), an issuer processor serving many prominent Fintech companies, such as Block’s Cash App and Square, reported its first quarter 2023 results on Tuesday, announcing a tricky combination of layoffs and stock buybacks. According to the company’s filing with the SEC, layoffs will impact approximately 15% of the company’s workforce and will result in $40 to $45 million in annual expense savings. In addition, the company’s Board authorized a plan to repurchase up to $200 million in the company’s common stock. “[Stock repurchase plan] demonstrates the strength of Marqeta's business and long-term market opportunity, which we believe is not reflected in Marqeta's current market valuation," said Simon Khalaf, Marqeta’s new chief in the company’s press release.
Otherwise, it was a decent report! Total Processing Volume increased by 37% YoY to $50 billion, and Net revenue for the quarter increased 31% YoY to $217 million. The company posted a Net loss of $68.8 million, compared to a Net loss of $60.6 million in the first quarter of 2022. Adjusted EBITDA for the quarter was negative $4.3 million, compared to negative $10.5 million a year ago. During the first quarter, Marqeta “deepened its partnership” with ONE, a leading consumer fintech backed by Walmart, as well as acquired a credit card program management platform Power Finance for $275 million in an all-cash deal. In the second quarter, the company plans to deliver a 17-19% YoY revenue growth, and expects an negative Adjusted EBITDA margin of 4-6%.
✔️ Marqeta Reports First Quarter 2023 Financial Results
✔️ Marqeta Names Simon Khalaf as CEO
✔️ Marqeta buys fintech Power Finance in $275M all-cash deal, its first acquisition
PayPal’s stock price fell to $63.38 a share after a disappointing earnings report on Monday. This is the lowest since…September 2017! 👇🏻
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