Shares of Sezzle (SEZL 0.90%) were taking a dive after better-than-expected results on the top and bottom lines were not enough to please investors.
As a result, the stock was down 33.7% on the news as of 11:42 a.m. ET.
Image source: Getty Images.
Sezzle cools off
Sezzle, a buy now, pay later (BNPL) company that's taken the market by storm over the last two years, continued to deliver impressive growth. Revenue grew 76.4% to $98.7 million, which beat analyst estimates at $94.9 million.
Sezzle's monthly on-demand and subscribers metric reached 748,000, up from 658,000 in the previous quarter, showing solid growth in its high-frequency user base. Gross merchandise volume was also strong, up 74.2% to $927 million.
Margins continued to expand as operating income jumped 116.1% to $36.1 million, and adjusted earnings per share was up 97% to $0.69.
CEO Charlie Youakim said, "The product features and marketing initiative we've rolled out are driving stronger engagement and broader adoption."
NASDAQ: SEZL
Key Data Points
What's next for Sezzle
While its results were strong, given its blistering growth coming into the report, investors may have expected a wider beat.
Additionally, Sezzle's guidance calls for its growth to continue to decelerate as the company sees revenue growth of 60%-65% and adjusted earnings per share of $3.25, which was just slightly below the consensus at $3.26.
After soaring growth through the first half of the year, that reflects a significant moderation in the second half of the year as well.
Still, the stock now trades at a forward P/E of under 30, which looks like a great price for the fast-growing, disruptive BNPL player.
