FinTech IPO Index Gains 0.3% as nCino and dLocal Post Earnings
Earnings season’s just about over.
But there were a few last reports among our FinTech IPO pantheon right before the next earnings season begins next week.
Beginning in mid-April, the big banks will start rolling out their reports on how the first quarter fared —– and by extension, we’ll get a sense of how financial services, in general, is holding up amid the continued inflationary headwinds. Details on card spending and loan delinquencies may be a harbinger for the FinTech players we track.
Those aforementioned fourth-quarter reports still trickling in brought the Index to a (slightly) positive performance for the week, up 0.3% for the past five days.
nCino and dLocal Join the Earnings Parade
nCino gathered 4.3%. The company posted results that showed total revenues for the fourth quarter of fiscal 2023 were $109.2 million, a 46% increase from $75.0 million in the fourth quarter of fiscal 2022. Subscription revenues for the fourth quarter were $92.8 million, up from $62.8 million one year ago, an increase of 48%. These revenues include the results of SimpleNexus. Organic subscription revenues, which exclude the revenues of SimpleNexus, were $77.0 million, a 30% increase from the fourth quarter of fiscal 2022.
Earnings materials that accompanied the report show that the company’s customer base stood at 1,858 in fiscal year 2023, up from 1,775 last year. There were 465 customers with subscription revenues above $100,000 annually in the latest fiscal year, compared to 271 last year.
In other earnings news, Uruguayan payments firm dLocal reported its own fourth-quarter results that showed total payment volumes gaining 78% annually to a record $3.3 billion and was up 21% quarter over quarter. Revenue rose 55% to $118.4 million. Management said on the conference call with analysts that 67% of payments volume came from noncredit card payment methods, including non-traditional payment methods such as local debit cards, bank transfers, digital wallets and mobile payments. According to commentary on the call, other payment methods have shown traction, including PIX and Boleto in Brazil, mobile money in South Africa, UPI in India and Oxxo in Mexico. Shares of the firm slipped 13.1% through the week.
Apple and the BNPL Movement
Shares in Affirm were up 1.4%.
As reported this past week, Apple has launched Apple Pay Later, its buy now, pay later offering.
Geared toward Apple Pay users, the payments option is being rolled out, at least for now, on an invitation basis.
Apple’s push into installments brings the tech giant directly up against BNPL providers such as Affirm.
As we noted here, Apple’s Pay Later consumers are subject to eligibility and approval, and the installment plan will be built into Apple Wallet. Apple’s loans will range from $50 to $1,000.
Paysafe shares lost 3.9%.
The company announced at the end of the month that it has expanded into the new Massachusetts mobile sports-betting market.
Paysafe said that The Massachusetts sports-betting market, which Legal Sports Report projects will generate $295.25m+ in first-year revenue, stands as the 26th jurisdiction where the firm operates as it supports online payments. The new market entry also extends Paysafe’s existing relationship with DraftKings.
SoFi logged a 0.5% gain.
News came this week that SoFi has acquired Wyndham Capital Mortgage to broaden its offerings to prospective homeowners. The all-cash purchase, per the announcement, broadens the digital mortgage experience while reducing the company’s use of third-party partners and processes.
SoFi said in the release its purchase of Wyndham “is not expected to be material to the company’s 2023 financial outlook,” although “it is expected to be accretive within six months.”