Shares of GigaCloud Technology (GCT 0.39%) are up 15.2% as of 12:45 p.m. ET Friday after the Hong Kong based business-to-business (B2B) e-commerce solutions company announced strong quarterly results.
GigaCloud's third-quarter revenue grew 39.2% year over year to $178.2 million, translating to net income of $24.2 million or $0.59 per share. Analysts, on average, were only expecting earnings of $0.38 per share on revenue of $178.2 million.
NASDAQ: GCT
Key Data Points
On GigaCloud's solid execution, recent acquisitions
This marked GigaCloud's third consecutive quarter of record profitability. Within GigaCloud's top line, service revenue from its GigaCloud 3P grew 27.2% year over year to $51.5 million, while product revenue from GigaCloud 1P increased 38.1% to $80.4 million. Product revenue from off-platform e-commerce climbed 58% to $46.3 million.
Meanwhile, GigaCloud Marketplace gross merchandise volume soared 40.8% year over year to $684.8 million, driven by a 9.6% increase in active buyers (to 4,602) and a 28.5% gain in spend per active buyer to $148,793.
GigaCloud also closed on a pair of acquisitions in recent weeks, including its $85 million purchase of Noble House Home Furnishings' assets on Oct. 31, and a $10 million purchase of cloud-based interactive digital signage company Wondersign on Nov. 15. The Noble House acquisition announcement in September caused GigaCloud stock to pull back hard as investors questioned the rationale for (and size of) the deal.
"Our continued focus on execution and adaptability has allowed GigaCloud to capitalize on market opportunities when they present themselves," explained GigaCloud founder, chairman, and CEO Larry Wu. "Further, the closing of the Noble House and Wondersign acquisitions highlights not only our strong profitability and cash position, but affirm our dedication to GigaCloud's mission of delivering a seamless end-to-end shopping experience for our marketplace participants."
What's next for GigaCloud investors?
GigaCloud expects fourth-quarter revenue of between $217 million and $223 million. That's far above Wall Street's consensus estimates for $143 million, but also isn't directly comparable as it includes revenue contributions from the Noble House and Wondersign purchases. GigaCloud didn't provide specific earnings guidance for the current quarter, so it remains to be seen whether its streak of outsize profitability will continue in the near term.
In any case, there's no denying this was a solid quarter from GigaCloud given its revenue and earnings beat even prior to its acquisitions. The e-commerce technology stock is simply responding in kind today.
