Amsterdam-based fintech unicorn Adyen published its shareholder letter and financial statements for H1 2023 on Thursday. The letter focuses on the company’s activities, finances, growth pillars, and more.
Here’re the key takeaways:
Processed transaction and EBITDA
As per Adyen’s report, the volume of processed transactions grew 23 per cent year-on-year
amounting to €426B. Adyen notes that most of the volume growth (>80 per cent) came from merchants that were already on the platform.
According to the report, Digital volumes are growing at a slower pace, landing at €267.1B in H1, making up 63 per cent of total processed volume and growing 23 per cent YOY.
Unified Commerce volumes maintained their global momentum, amounting to €109.2B in H1 and growing 36 per cent YOY. The report adds that Unified Commerce volumes comprised 25 per cent of processed volume.
Platforms contributed €49.7B in H1, making up 12 per cent of total processed volume and growing 3 per cent YOY.
POS
Point-of-sale volumes were €67B, making up 16 per cent of total processed volumes and outpacing overall business growth at 49 per cent YOY.
Adyen says that growth rate highlights the relevance of multi-channel experiences across industries and their significant traction.
Net Revenue
Adyen registered net revenue of €739.1M in H21 2022, growing 21 per cent YOY. The company says the majority of its net revenue came from its land-and-expand commercial strategy.
In some areas, the business grew at a lower rate than anticipated due to the macroeconomic environment and industry pricing competition at the intersection of North American and online payment, says the company.
Net revenue contributions remained consistent YOY with:
- EMEA contributing (57 per cent)
- North America (25 per cent)
- APAC at (11 per cent)
- LATAM landing at (7 per cent).
APAC was the fastest growing (up 31 per cent YOY), followed by North America growth (up 23 per cent YOY), EMEA (up 20 per cent YOY), and LATAM (up 13 per cent YOY).
Operating expenses
Total operating expenses for Adyen in H1 2023 were €460M, up 66 per cent from H2 2021.
Employee benefits were €285.9M in H1 2023, up 80 per cent YOY.
Sales and marketing totaled €27.4M in H1 2023, up 13 per cent YOY.
EBITDA
EBITDA was €320M in H1 2023, down 10 per cent from €356.3M in H1 2022. The EBITDA margin landed at 43 per cent, compared to 59 per cent in H1 2022.
CapEx and Free cash flow
Adyen’s CapEx was €56.1 M and 7.6 per cent of net revenue, up from 6.6 per cent of net revenue in H1 2022.
The company’s Free cash flow was €247.7M in H1 2023, down 20 per cent YOY. The free cash flow conversion ratio was 77 per cent.
Adyen’s Financial objective
According to Adyen, it has not seen any developments in the business over H1 2023. As a result, the company’s financial objectives remain unchanged from the last time they published results.
They are:
- To grow net revenue and achieve a CAGR between the mid-twenties and low-thirties.
- To improve EBITDA margin and increase to above 65 per cent in the long term.
- To maintain a sustainable capital expenditure level of up to 5 per cent of Adyen’s net revenue.
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