A 51% Increase In Earnings, At Scale
Adyen, a Dutch payments processor, reported a 51% increase in core earnings in the second half of 2021, exceeding expectations and sending its stock price soaring. Net sales for the period was 556.5 million euros ($635.9 million), up 47% year over year, according to the business. For the full year, EBITDA grew 57% year over year to 630.0 million euros.
- According to Reuters, this was greater than analysts' expectations of 552 million euros in net revenue and 346 million euros in EBITDA
- In the second half, Adyen's profit margin increased to 64%, up from 61% in the first half
- The overall volume of transactions completed increased by 72% to 300 billion euros
Mix Of Digital And Physical Payments Boost Adyen
Even as economies recover, the Dutch company thrives because its system accepts a wide range of payments: in-store at traditional shops or self-serve checkouts, and online for delivery or curbside pickup. In 2013, it began developing that in-store capacity as a strategic endeavor.
- Adyen built its system from the ground up rather than through acquisitions, and it continues to improve it by solving existing client problems while also pursuing a few broad objectives
- This typically means that a solution designed for solving one specific issue can be extended to most of its current customer base
"Once a company uses Adyen for its in-store payment terminal, [Pieter van der Does, Adyen’s cofounder and chief executive officer] said, it tends to use Adyen as its sole payments provider across all parts of its business, whereas those who were only using the company for mobile or e-commerce had often maintained relationships with multiple payment vendors." by Jeremy Khan for Fortune
This contributes to customer satisfaction and retention. Current merchants accounted for over 80% of growth last year, while those who stopped using the service accounted for less than 1% of transaction volumes. And the company is not standing still.
- The product road map includes solutions for new purchase methods such as buy-now-pay-later
- As well as huge ambitions to provide merchants additional insight into their in-store customers, including connecting with online shopping data
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Photo by Adyen.