marqeta earnings

Marqeta sets sights on embedded finance in 2023

Marqeta’s new year has already seen some significant shifts. 

In January, the company announced the appointment of Simon Khalaf as the new CEO, moving Jason Gardener to Executive Chair. Khalaf joined the company in June 2022 as Chief Product Officer, leading the launch of Marqeta for Banking. 

Simon Khalaf, CEO of Marqeta
Simon Khalaf, CEO of Marqeta

A few days later, the company announced its first acquisition, which is expected to close before the end of Q1 2023. The target was Power Finance, which offers a cloud-native credit card management platform set to enhance the capabilities of Marqeta’s existing credit card products.  

Soon after, Khalaf announced his intentions to set the company’s sights on embedded finance. 

Yesterday, February 28 2023 he addressed stakeholders for his first earnings call as CEO. 

“I am very proud of the scale our business reached in 2022,” said Khalaf. “Now we are entering 2023 uniquely positioned to capture the massive opportunity in embedded finance.” 

“Our cloud-native and API-first platform offers a fully bundled offering – debit, credit, risk, money movement, and program management tools, making it seamless for our customers to embed financial services into their own products.”

Promising growth in Q4

Luckily for Khalaf, Marqeta’s Q4 2022 results showed promising growth. 

In the fourth quarter, total payment volume increased by 41% year-over-year (YoY), reaching $47 billion by the end of December. Net revenue also increased by $48 million YoY, representing 31% growth to just under $204 million. Additionally, gross profit grew by 15% while the company’s net loss dropped by 28%. Adjusted EBITDA was a loss of $7 million. 

It was an end to a year of growth, overshadowed only by an increase in a net loss by $21 million for the full year, which the company has stated is due to headcount growth. 

“We ended the year in a position of strength, once again demonstrating our ability to grow and innovate at scale,” said Khalaf. “While I’m pleased with where we ended up in 2022, I’m actually more excited about the opportunities ahead of us.”

Ongoing interest in a shift to embedded finance

He reiterated his belief in the embedded finance sector as the best possible focus for the business going forward. “The Embedded finance market is rapidly expanding and evolving. Our data has powered embedded finance for years, one application at a time,” he said.

“It’s not a cultural shift. It’s an operational shift that has led to us succeeding in this space. And it’s kind of like the market came to us because that’s how Marqeta is. Marqeta is API first. So by definition, we fit well into somebody else’s technology.” 

“We consider ourselves the only issuer-focused company with a bundle that truly meets where payments are going. I am confident we will capitalize on this tremendous opportunity.”

Due to this focus, he shared three priorities for 2023: 

  1. Integrating the acquisition of Power Finance, which Khalaf explained, could give Marqueta significant capability to increase their product offering. “Our customers will be able to create credit card programs that are unique and personal in significantly less time than we would take with multiple platforms,” he said.
  2. Continuing to accelerate sales through deepening and extending relationships with institutional customers. 
  3. Driving innovation within the company’s economies of scale. Due to the two significant product launches in 2022 and the company’s recent acquisition, Khalaf explained he expected innovation to be possible to achieve economies of scale without the same rate of investment and headcount in 2023. 

For Q1 2023, the company has set guidance for net revenue growth to range between 26%-28%, gross profit growth to range between 14%-16%, and Adjusted EBITDA margin between negative 5%-6%.

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  • Isabelle Castro Margaroli

    With over five years in the art and design sector, Isabelle has worked on various projects, writing for real estate development magazines and design websites, and project managing art industry initiatives. She has also directed independent documentaries on artists and the esports sector. Isabelle's interest in fintech comes from a yearning to understand the rapid digitalization of society and the potential it holds, a topic she has addressed many times during her academic pursuits and journalistic career.

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