Sezzle (US:SEZL)2025-11-05 23:39Financial Performance - Total revenue for Q3 2025 reached $116,796,000, a 67% increase from $69,958,000 in Q3 2024[17] - Operating income for Q3 2025 was $35,561,000, compared to $20,842,000 in Q3 2024, reflecting a 70% increase[17] - Net income for Q3 2025 was $26,671,000, up from $15,446,000 in Q3 2024, representing a 73% increase[17] - Net income for the nine months ended September 30, 2025, was $90,439,000, compared to $53,155,000 for the same period in 2024, representing an increase of 70%[23] - Total revenue for the nine months ended September 30, 2025, reached $320.4 million, compared to $172.9 million in 2024, marking an increase of 85%[38] Assets and Equity - Total current assets increased to $329,454,000 as of September 30, 2025, from $257,619,000 at the end of 2024, a growth of 28%[15] - Total assets grew to $366,964,000 as of September 30, 2025, compared to $298,372,000 at the end of 2024, marking a 23% increase[15] - Total stockholders' equity increased to $155,270,000 as of September 30, 2025, up from $87,835,000 at the end of 2024, a growth of 77%[15] Cash Flow and Liquidity - Cash and cash equivalents increased to $104,147,000 as of September 30, 2025, from $73,185,000 at the end of 2024, a rise of 42%[15] - Net cash provided from operating activities for the nine months ended September 30, 2025, was $55,618,000, compared to $39,928,000 in 2024, an increase of 39%[23] - Cash, cash equivalents, and restricted cash at the end of the period on September 30, 2025, totaled $134,656,000, up from $88,343,000 in 2024, an increase of 52%[23] Credit Losses and Risk Management - Provision for credit losses for Q3 2025 was $32,177,000, significantly higher than $15,402,000 in Q3 2024, indicating increased risk management measures[17] - The company recognized a provision for credit losses of $32.2 million for Q3 2025, compared to $15.4 million in Q3 2024, representing a 109.7% increase[55] - The allowance for credit losses increased to $33.7 million as of September 30, 2025, compared to $18.6 million at the end of Q3 2024[55] Revenue Sources - Merchant and partner income totaled $26.0 million for Q3 2025, up from $21.9 million in Q3 2024, representing a 18.7% increase[40] - Transaction income from consumer fees increased significantly to $33.5 million in Q3 2025, compared to $14.5 million in Q3 2024, marking a 131% growth[41] - Subscription revenue for Q3 2025 was $24.3 million, compared to $22.9 million in Q3 2024, reflecting a 6.1% increase[44] Expenses - Marketing, advertising, and tradeshow expenses surged by 221.9% to $8.8 million for the three months ended September 30, 2025, compared to $2.7 million in 2024[115] - Personnel expenses increased by 6.7% to $14.3 million for the three months ended September 30, 2025, compared to $13.4 million in 2024[110] - Third-party technology and data expenses rose by 55.2% to $3.7 million for the three months ended September 30, 2025, compared to $2.4 million in 2024[114] Stock and Shareholder Actions - The company performed a 6-for-1 stock split effective March 28, 2025, impacting share and per share amounts retroactively[15] - The Board of Directors authorized a stock repurchase program of up to $50 million, effective from April 7, 2025, to April 7, 2026[158] - During the three months ended September 30, 2025, the company purchased 47,089 shares at an average price of $84.24 to cover tax obligations[157] Legal and Regulatory Matters - The company filed a lawsuit against Shopify for antitrust violations, seeking damages that could be tripled under applicable laws[153] - The company does not believe that the outcome of ongoing legal matters will have a material adverse effect on its financial position[154] - The company is currently assessing the impact of the One Big Beautiful Bill Act enacted on July 4, 2025, which includes significant tax provisions[37] Taxation - Income tax expense for the nine months ended September 30, 2025, was $20,871,000, compared to a benefit of $(13,567,000) in 2024, reflecting a significant change[122] - The effective income tax rate for the three months ended September 30, 2025, was 15.7%, up from 12.3% in 2024, while for the nine months it was 18.8% compared to (34.3%) in 2024[122] Consumer Metrics - Active Consumers increased to 2.971 million as of September 30, 2025, representing a 9.0% growth from 2.725 million at the end of 2024[87] - Monthly On-Demand Users and Subscribers (MODS) rose to 784,000, an 11.0% increase from 707,000 in December 2024[87] Financial Controls and Compliance - As of September 30, 2025, the company's disclosure controls and procedures were deemed effective at a reasonable assurance level by the CEO and CFO[149] - No changes in internal control over financial reporting occurred during the nine months ended September 30, 2025, that materially affected internal controls[150] - The financial statements fairly present the financial condition and results of operations of Sezzle Inc. for the quarter ended September 30, 2025[172]