LAS VEGAS - Marqeta (NASDAQ: MQ), a global modern card issuing platform, announced today the development of Marqeta Flex (NASDAQ:FLEX), a new product designed to integrate Buy Now, Pay Later (BNPL) options within payment apps and digital wallets. The announcement was made at the Money 2020 conference, highlighting the collaboration with payment providers Klarna, Affirm, and Branch, a payments platform.
Marqeta Flex aims to personalize the BNPL experience for consumers by offering them tailored loan options at the point of purchase within the payment flows they frequently use. This solution is expected to enhance the distribution of BNPL services, providing consumers with more choices for their transactions.
Simon Khalaf, CEO of Marqeta, emphasized the transformative impact of BNPL in the past decade and the company’s commitment to expanding consumer access to these payment options in collaboration with leading industry players. Branch plans to incorporate Marqeta Flex into its app, which serves W-2 and 1099 workers, to provide them with customized BNPL options.
The service is designed to be user-friendly, allowing consumers to select a Pay Later option and receive personalized payment plans. Marqeta Flex also benefits payment providers and card issuers by driving higher transaction volumes and providing access to a variety of global BNPL providers through a single integration.
Marqeta, which has already facilitated the growth of BNPL solutions worldwide, processes over $200 billion in annual payments volume. The company operates in over 40 countries and is recognized for its ability to offer businesses the tools to create financial solutions that cater to consumer preferences.
The information in this article is based on a press release statement from Marqeta.
In other recent news, payment solutions company Marqeta has been in the spotlight with Goldman Sachs (NYSE:GS) maintaining a neutral rating and a price target of $6.00. The firm acknowledged Marqeta's positive growth trajectory, strong booking trends, and potential for international expansion. The company's management has shown interest in smaller-scale mergers and acquisitions to enhance capabilities and offerings.
Marqeta's recent Q2 earnings revealed mixed results with a 46% decrease in net revenue and a 6% contraction in gross profit, but a notable 32% year-over-year increase in total processing volume, reaching $71 billion. These changes in revenue are largely due to adjustments from the Cash App contract renewal. The company also reported a negative adjusted EBITDA of $2 million.
Recent developments include strategic partnerships with Varo Bank and Zoho, and a certification by Visa (NYSE:V) for flexible credential support. These alliances position Marqeta for growth in financial services and expense management solutions. The company projects net revenue growth between 16% and 18% for Q3 and Q4, with gross profit growth expected in the mid-20s percentage range. Despite the contraction in revenue and gross profit, Marqeta remains optimistic about achieving profitability and sustainable growth in the near future.
InvestingPro Insights
As Marqeta (NASDAQ: MQ) unveils its innovative Marqeta Flex product at Money 2020, investors might be keen to understand the company's financial position and market performance. According to InvestingPro data, Marqeta's market capitalization stands at $2.69 billion, reflecting its significant presence in the fintech space.
Despite the company's ambitious moves in the BNPL sector, it's worth noting that Marqeta has faced some financial headwinds. The company's revenue for the last twelve months as of Q2 2023 was $470.95 million, with a concerning revenue growth decline of -44.19% over the same period. This aligns with an InvestingPro Tip indicating that analysts anticipate a sales decline in the current year.
On a positive note, Marqeta maintains a strong liquidity position. An InvestingPro Tip highlights that the company's liquid assets exceed its short-term obligations, which could provide financial flexibility as it rolls out new products like Marqeta Flex.
The stock's performance has been mixed, with a 5.37% price return over the past year, but a -24.07% return year-to-date. This volatility is reflected in another InvestingPro Tip, which notes that stock price movements are quite volatile.
For investors seeking a deeper understanding of Marqeta's prospects, InvestingPro offers additional insights, with 8 more tips available on the platform. These tips could provide valuable context for evaluating the potential impact of Marqeta Flex on the company's future performance.
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