Earnings Release • Nov 7, 2024
Earnings Release
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Q3 2024 Business Update
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Net revenue was €498.3 million in Q3 2024, up 20% YOY. On a constant currency basis, net revenue growth was 21% YOY. Our growth continues to be driven by longstanding underlying trends including wallet share expansion, further diversification in our merchant mix, and winning new business. Existing customers continue to drive the majority of our growth.
Processed volume landed at €320.6 billion, up 32% YOY. Platforms remained our fastest growing pillar overall as we continue to scale our customer base. Meanwhile, Unified Commerce demonstrated strong growth as we further diversified our vertical offering, and Digital continued to show consistent underlying growth trends. Compared to H1, the lower volume growth is driven entirely by a single large volume customer which, as previously referenced, has a limited impact on net revenue.
Digital processed volume was up 29% YOY, with growth trends in this pillar remaining consistent from the first half of the year, excluding a single large volume customer. We continued to see good progress in digital content and subscription, as well as in our delivery and mobility verticals. In the last three months, we further enhanced our US Debit offering by launching Intelligent Payment Routing. In a pilot of over 20 enterprise customers we delivered average cost savings of 26% alongside a 0.22% authorization rate uplift. Our continuously evolving product offering drives our ability to deliver high return on investment for our customers through cost optimization without compromising on performance.
Unified Commerce processed volume was up 33% YOY. Large format retail and hospitality remain among our fastest growing verticals. This broadening appeal of our offering is something we are proud of and is reflected in the detailed metrics we shared for this pillar over the last year. We now have 559 customers processing across multiple regions with our omnichannel offering, up 91 YOY. Additionally, we have 74 additional customers processing across channels at scale1 since Q3 2023, bringing the total up to 382. On the product side we launched SFO1, our newest terminal that creates a more tailored experience for shoppers while lowering costs for our customers. Our commitment to innovation allows us to maintain persistent growth as seen by the addition of 46k transacting Unified Commerce terminals over the last 12 months, bringing the total up to 299k.
1 Defined as the number of merchants processing at least €10 million on both POS and eCommerce, with over €50 million in total processed volume in the last 12 months.
Platforms processed volume was up 44% YOY. Excluding eBay, Platforms volume grew by 54% YOY. We continued to scale our customer base and now have 25 platforms processing over €1 billion annually, compared to 17 at this time last year. The expanding scale of this customer base is a testament to the strong value proposition of our Platforms offering, also reflected in the growth of our platform business customers2 , now at 126k. We continue to see this traction across channels, with the number of transacting terminals reaching 182k, up 77k YOY.
In the last three months, we welcomed 35 net-new joiners, as we continue to hire according to the investment areas we identified at the beginning of the year. The majority of these team members joined in commercial roles, further expanding our team in North America. Hiring is not always linear, and while we will continue to focus on the key investment areas for the remainder of the year, we are committed to maintaining a high bar for talent.
We did not see any business developments in Q3 2024 that would lead us to update our guidance. Our standing financial objectives therefore remain unchanged.
Net revenue growth: We aim to continue to grow net revenue annually between the low-twenties and high-twenties percent, up to and including 2026.
EBITDA margin: We aim to improve EBITDA margin to levels above 50% in 2026, as we expect to benefit from operating leverage inherent to our business model.
Capital expenditure: We aim to maintain a sustainable capital expenditure level of up to 5% of our net revenue.
We will broadcast a live audio call hosted by Adyen CFO, Ethan Tandowsky, to discuss these results at 3PM CET today, November 7th, 2024. You can tune into the livestream at investors.adyen.com. A recording of the conversation will be made available on our Investor Relations website following the call.
2 We have updated the definition of platform business customers to include all end-customers that meet the processed volume thresholds for capital grants.
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Forward-looking statements are not facts and only represent the current views and assumptions of Adyen N.V. ("Adyen") regarding future events, many of which are by nature inherently uncertain and beyond Adyen's control. Factors that could cause actual results to deviate materially from those anticipated by forward-looking statements include, but are not limited to, macroeconomic, demographic and political conditions and risks, actions taken and policies applied by governments, financial regulators and private organizations (including payment schemes and credit rating agencies), market conditions and turbulence in financial and other markets, and the success of Adyen in managing the related risks.
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