Adyen shares dropped after a revenue and profit miss in the first half of the year.
After the Dutch payments company posted lower-than-expected first-half core income and revenues, Adyen NV (AS:ADYEN) shares dropped to near the bottom of the pan-European STOXX 600, erasing early gains.
An increase of 31% from the first half of the year was seen in earnings before interest, taxes, depreciation, and amortisation, which totaled €356.3 million. In the meantime, yearly net income increased by 37% to €608.5 million.
On revenue of €615.2m, analysts anticipated a core profit of €383.5m.
The results were bolstered by a jump in transaction volumes, which increased to an unexpectedly high €345.8 billion. Adyen said that the number of people was going up because people were travelling again after COVID-19 restrictions were lifted.
Adyen, a payment processor for major merchants including Uber (NYSE:UBER) and Spotify (NYSE:SPOT), accelerated employment, which contributed to a 47% increase in operational expenses. Full-time staff climbed by 395 to 2,575 over the period, and the company said it planned to maintain this rate of growth in the second half of the year.
Barclays analysts are worried that the increase in staff could hurt Adyen’s profit margin in the short term. However, they say that this investment is necessary for the company to keep growing in the long term.
Adyen, which debuted on the Euronext exchange in Amsterdam in 2018, saw an 11% drop in value on Wednesday, although the stock is still trading at a significant premium to where it started trading.
According to Citi analysts, the stock’s underperformance was caused by a surge in the most recent earnings, increased buy-side expectations, and Adyen’s premium valuation. Adyen has a price tag of about €50 billion at the moment.