Marqeta Inc. has recently announced a significant development in its partnership with Block Inc., easing investor concerns. The company has extended its contract with Block SQ to power the Cash App debit card, with the agreement now in effect until June 2027. This news accompanies Marqeta’s latest earnings report, which has sparked a 16% increase in the company’s shares during Tuesday’s extended session.
The main focus of interest during the announcement is the impact of the new contract on the company’s Q3 performance. Notable financial analyst, Dan Dolev of Mizuho, highlighted this as a crucial discussion point for clients.
In terms of financials, Marqeta posted its second-quarter results, reporting a net loss of $58.8 million, or 11 cents per share. This compares to a loss of $44.7 million, or 8 cents per share, in the same period last year. Analysts predicted a slightly better performance, with an estimated loss per share of 10 cents.
Adjusted earnings before interest, taxes, depreciation, and amortization (Ebitda) stood at $824,000 for the quarter. In the previous year, Marqeta recorded a loss of $10.2 million on this metric. The FactSet consensus forecasted a $9.8 million loss on adjusted Ebitda for the latest quarter.
Net revenue saw a healthy increase from $187 million to $231 million, surpassing analyst estimates of $225 million. Additionally, total processing volume reached $54 billion for Q2, demonstrating a 33% year-on-year growth rate.
CEO Simon Khalef expressed satisfaction with the company’s performance in Q2, emphasizing the significant milestones achieved in terms of scalability and sales success. Marqeta has also made strides in enhancing its product offering and extending its valuable partnership with Cash App.
Marqeta’s recent contract renewal with Block Inc. along with its strong second-quarter results have instilled confidence in investors and shareholders alike.
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