fintech earnings

Facebook pummeling pulls down fintech earnings

The beginning of February ’22 will be remembered for one thing: Facebook — and the tech market it has come to represent — had a terrible quarter.

The supergiant with a new name dropped more than 24% in a single trading session after missing earnings estimates, the most significant one-day drop for a firm in U.S. history.

What’s more, Meta only missed earnings by $.17 a share and beat revenue for the first quarter by $700 million. Still, a lack of added users, a money sink of more than $10 billion in the new metaverse section of the company, sent the shares careening downward.

Fintech was pulled into the red too. Last week, tech like PayPal, Robinhood, and even Lending Club followed the same trend: fewer subscribers, close but not surprising earnings, ’22 predictions that spooked investors, and revenue that no one cares about if the stock doesn’t pay out.

PayPal: ouch

PayPal saw a “strong finish” to the year in volume and revenue, but not enough to beat estimates. EPS was a single cent lower, $1.11, and revenue was $6.89 billion, a difference of $30 million from expert opinions that sent the stock price dropping like a rock. The news that more than 4 million user accounts were fraud bots created to soak up free promo money did not help the sinking share price.

“Twenty-twenty-one was one of the strongest years in PayPal’s history. We reached $1.25 trillion in TPV and launched more products and experiences than ever before. The future is moving in our direction, and we are investing in our consumer and merchant capabilities to seize the opportunity in front of us,” President and CEO Dan Schulman said in the release.

Enova: This weeks Golden Goose

On Thursday, Enova posted their fourth-quarter ’21 earnings, showing a tremendous jump in revenue and EPS that beat expectations, sending the share price up. The online lender results boasted $363M in revenue, with a 25% jump in organizations from Q3: a record $1.1B. Based on these results, Enova is happily looking forward to another year of new originations and strong credit performance, CFO Steve Cunningham said in the earnings call after market close.

“We skillfully navigated a complex and rapidly changing market environment, quickly accelerating our originations as the economy recovered and helping our customers get access to fast, trustworthy credit,” CEO David Fisher said on the call. “At the same time, we kept a close eye on credit performance, which has remained much better than pre-pandemic levels. As a result, total company originations doubled year-over-year to $1 billion, and total company combined loan and finance receivables increased by 48% to $2 billion.”

Robinhood

The stock-betting PFOF “democratizer of investing” app called Robinhood ended up costing investors money with terrible, negative earnings per share on Thursday, Jan. 27.

Revenue was down to $363M in Q4 ’21, compared to $522M in Q1. A $423 M net loss sent shares tumbling 15% to $9.98, compared to the August high of $85.

Crypto sales, which made up more than half of all revenue on the platform in the past, we’re down to just 18% of the total, and active users peaked in May.

LendingClub

The fintech that became a full-time bank showed a full profitable year for the first time but was not suitable enough for investors.

Nearly a full year after buying RadiusBank, LendingClub showed a revenue of $262.2M and diluted earnings per share of $0.27.

Still, forward-looking statements from the earnings call last week were disappointing, and the stock continues to drop along with the rest of the fintech market.

“I’d like to give a huge shout out to our highly engaged and resilient employee base of LendingClub,” CEO Scott Sanborn said during the earnings call. “Thank you all for a great year, and I can’t wait to tackle 2022 together. We are well-positioned to thrive.”

  • Kevin Travers

    Intensely energetic news reporter asking questions covering the collision between Silicon Valley, Wall Street, and everywhere in-between. Studied history at the University of Delaware, learned to write at the Review, and debanked. Email kevin@lendit.com with story ideas, questions, or to say hello.