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Marqeta Inc. addressed a key investor concern Tuesday as it announced a four-year renewal of its contract with Block Inc. alongside its latest earnings.
The company has extended its deal with Block
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to power the Cash App debit card through June 2027, Marqeta
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said in a Tuesday afternoon release.
Shares of Marqeta, which makes card-issuing technology, flew 20% higher in Tuesday’s extended session.
“Most importantly — and likely the only discussion point to expect on the call — is the guide given that the new [Block] contract starts on July 1, 2023, and will thus affect [the third quarter],” Mizuho’s Dan Dolev wrote in a note to clients.
Marqeta also posted second-quarter results, delivering a net loss of $58.8 million, or 11 cents a share, compared with a loss of $44.7 million, or 8 cents a share, in the year-prior period. Analysts tracked by FactSet were anticipating a 10-cent loss per share.
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The company also reported adjusted earnings before interest, taxes, depreciation and amortization (Ebitda) of $824,000, whereas it logged a $10.2 million loss on the metric a year earlier. The FactSet consensus was for a $9.8 million loss on the basis of adjusted Ebitda in the latest quarter.
Net revenue climbed to $231 million from $187 million, whereas analysts were modeling $225 million.
Total processing volume for the second quarter came in at $54 billion, up 33% on a year-over-year basis.
“In the second quarter, we grew our business to ever-increasing levels of scale, exceeded our sales bookings goals again and reduced our cost structure,” Chief Executive Simon Khalef said in a release. “Our execution has been strong, including accelerating our go-to-market motion, enhancing our product offering, and extending our partnership with Cash App.”
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