Marqeta (MQ) 8 Aug 232023 Q2 Earnings call transcript

Good afternoon and welcome to Marqeta's Second Quarter 2023 Earnings Call. All participants will be in listen-only mode. [Operator Instructions] Please note that this event is being recorded.

I would now like to turn the conference over to Stacey Finerman. Please go ahead.

operator. Thanks,

further speak I forward-looking our Annual ended XXk remind anticipated forward-looking changes numerous on statements and or investor for forth our the our others. on statements, and relations obligation XXXX results begin, or the subject development by to call differ that future uncertainties as like XX, results our These development of and may law. operating we website be contain as call subsequent our period the forward-looking to may Report this except materially accounting the statements including the Actual filings and filing would we many treatment everyone to with today's including financial regarding intent any are that company Before SEC. set of accounting make in among does our treatment assume required are the for changes and statements periodic available SEC, today. subject statements including Form December These risks only risk update to which may further them, not in time for regarding forward-looking

amortization earnings could These call such be found for the and some in and today's of measures the today's financial items, expense supplemental comparable as press effect supplement and can available unreasonable which to without A the significant. our challenges measures release depreciation Reconciliations base tax of or directly on compensation, materials payroll GAAP not financial be investor includes estimating with addition, to efforts website. a non-GAAP forward-looking measures. which not and share considered as In non-GAAP is be GAAP are reconciliation should expense guidance relations impractability due substitute measures. of to a the available release most earnings

call over Simon Chief that, begin. like to Marqeta's the are Financial CEO Simon and Khalaf, I'd call to today's With Officer. turn to Hosting Marqeta’s Mike Milotich,

Stacey a and four you for thank Cash renewed joining We quarter years. everyone quarter had our we strong with you, just second call. for partnership Thank and App XXXX earnings our

revenue quarter. EBITDA Our better resulting were second expected the adjusted for in gross operating quarter expenses positive than profit and net we

believe In addition, Cash The started our effort step integration to final operating embedded, made fast App the the sales and a of again represents This sharpening have to sustainable our exceeded am reducing the I proud through and acquisition Marqeta. I our and the yearlong expenses. once firmly operation, we've bookings. of we is growth market. finance fast Marqeta go-to-market product extremely line major renewal our tremendous effort expanding re-establish long-term finance progress in growing, well-positioned for by on power the capitalize

XX% or increased compared TPV Let $XX processing financial the back was XXXX. performance. quarter consecutive billion. Total our go volume TPV of me to where This exceeded our second same the to quarter

X% decrease the XXXX, Our increase XXXX represented $XX $XX adjusted operating EBITDA million, quarter. the while positive for versus net was million in profit X% QX, growth adjusted expenses Gross a year-over-year. of an quarter, $XXX revenue in versus XX% in million were QX resulting the quarter

As disciplined we've very about being our few quarters, the to grow business our we done in continue last costs. while

innovation, Earlier continue on and in Block. block as well our another We of to value the renewal scale, fees year as flexibility, App, provide excited Cash and we our platform This our is partnership. moving exemplified we're Cash years. by this believe renewal, myriad App to services our Now Afterpay. this to partnership four the demonstrated and value for with

XXXX, App the decisions long-term, partnership for we can expected our us our of short It extending the focus well to so years and proactively our the While based come. on impact this middle positions term, growth on will we financial outcome. Cash something made in also through results for maximizing the it's

the working and together, we can two our this what can do to both ahead companies extend scope amazing of continuing us. opportunity By of together capitalize on

Cash the momentum sales in the seen changes fall across steadily improved renewal, execution three implementing addition We've in go-to-market company. App organization we've In our the after XXXX. quarters to of in our the considerable the last

bookings for bookings expansion a period XX-XX quarter a customers On two-thirds the XXXX. three prior ago. the bookings. from into deals last growth setting Our finance, grew grew which same with durable net-new by our a year we XXX% the existing for between and our saw of accounted quarter second quarters for sequential for from combined the split up customers basis, a driven Notably, XX% embedded us

third addition, where similar the continues we the and replace platform speaks flip quarter to deals first in one In deals, signed to to be provider, incumbent in our were In quarter, scale. an superior of our new source that business customers. we of international the a

markets the States. outside As customer over from came net-new United of XX% bookings

growth be international going a key key expect for driver represents momentum a and that We advantage would Marqeta. forward

customers aspirations. us existing of a the Latin market the to with single most partner foothold stack is one have countries customers into This gives and partnership of the Fitbank. our recent our in growing in Marqeta many The allows Our new platform platform is world, where launch growth expansion XX than fastest a largest fintech more enabled. also and America, fintech easily market in Brazil where

We a marketer an embed to management replace also, the and global well-known is solutions IT platform. expansion new States. make a new customer, outside support Marqeta signed this a with of customer, partnership HR looking a This vote the the financial recently to and our company. couldn't move volume further pathway We for U.S. looking to company in a to management products also to This United product employment the cloud-based with competitor them their confidence incumbent who continue platform. a saw into provider structures,

offer ability products our on focus a manner. our our limited to customers Our execution to evident to has new increase also It's in strategy. in been not go-to-market rapid

platform. of Marqeta we integrating the acquisition now June, result code finished integrated integrated. that fully are In into APIs as power Powers and their fully we a late planned, As our

general Platform to XXXX availability and the servicing, of with end before programs. offer track are We management, office, commercial program consumer origination, for Credit card Marqeta service back the of ancillary and on

This is finance to unlock additional crucial look we improves as embedded that execution opportunities.

a banking, management, platform a delivery, of competitive foundational and matter now, card and way nice fact, both Marqeta As element years, expertise over has the given in pay game for been buy been for even on finance us Modern expense a access, mobile accelerated a it advantage. issuing has later. wage XX was demand embedded before buzzword,

on efficiency focus execution. improved Our games regarding mirror our

$XX operationally our operating we're million service short, and offering generative $XX annual executing, risk deploying an to We're to run innovating; we're reduced competition, support operations. million in against customer risk rate basis. our expenses winning on all have AI In tools also being efficient. we're We the streamline our while by we're delivering, our

also product We make to use AI teams generative efficient. more our

their model. AI's As time our time code to on our spent an code reduce to to AI by the their help testing on generation teams a large time accelerate AI generate We're tasks integration market. to expedite with allows language example, using open customers our credit It use API and for Marqeta’s purpose-built the to created up and reducing banking length learning working customers also and generative XX%. launch tools generative to

have this I'm accomplished with year. all happy we summary, In

integrating with After and significantly in and solved volume. costs acquired problems. non-block of the while have reduced its competition, We in months. time all this We operating our in Pay, our company, App, our a renewed record XX% partnership and our Cash go-to-market against did We winning product five

our strong to near mention well, the sheet, deliver profitable accomplishments, we as balance to future. exceptionally us growth These not position sustainable, in look

prepared With for that, I'll over Mike turn it to his remarks.

good afternoon, everyone. and Simon, you, Thank

Cash excited made we go-to-market last initiatives. progress the about App efficiency year have as on as We well and renewal, over the both are the

renewal, the we results. financial discuss strong highlight our quarterly the Before let me aspects of

revenue XX% Second adjusted in gross several growth well as QX, volume from billion was customers, our scale. through year-over-year, profit driven of restructuring of by demonstrate within as growth as at efficiency particularly of a X% efforts, our EBITDA expense stronger growing all our savings TPV technology, growth to and well achieved May. our positive, continuing as growth XX% were quarter expectations, top above margin, net XX

vertical the than as The Cash as growing and Apps growth, continued to transacting several customers company access rapidly. points holders, whole. well higher-spend-proactive contributor to services the faster growth highest and fueled card wage with by use financial active ramping continues was be a cases as accelerated user, This

as was by be that the boosted through by travel offerings spend, used as new later, increased our customers Lending, that the now can merchant. a card deliver proposition NPL relatively well value any growth at including pay

company overall program one NPL migrated to Klarna, the in growth. the similar QX which of growth XXXX, Excluding was a portion

slowing also well Expense as prior QX with management million a strong year-over-year, was the verticals, when as line net to growing company vertical. $XXX and TPV the comps quarters on-demand powered to delivery, as remains Marqeta services due as multiple including XX% financial tougher business. in compared revenue our maturity and overall across by growth grew of whole,

be contributor from in our as X strong continues revenue QX. net a Block points XX% about up to growth, QX concentration to to increased

driven Marqeta volume, with managed last take mostly Our than last increased by toward last our by take in The a Marqeta of versus mix two three year. driven QX BNPL. was by bips shift of increases except revenue consistent bips major quarter is rate net rate for and our year lower decline by powered each verticals, as

One, a TPV the network was our four growing following is by about benefit. quarter expected, by periods growth QX roughly mid-to-high QX digits. from unexpected in which review of faster single was Gross volumes of lowering remainder we than a previous between gross partners. XXXX driven That a a was of for This low with driven renewed X%. our million $XX non-blocked and third and by was stronger QX approximately of primary catch-up of profit we growth points XXXX, reasons. growth one XX% profit X incentive

QX starting year, low Due we from incentive our lowering changes in lowering we Two, growth our of last slower each to mid-single year, build did by last in are April one towards zero we incentive March Three, program run a by as Klarna lost QX QX in timing, incentives, TPV we than that year, growth every digits. contracts to tiers. and from up digits. the single filled portion from meaning starting incentive tiers volume our Visa

we customers digits. by four Four, two XXXX, lowering for at Visa lost our of the of start growth mid-single incentives

lowers unexpected per by which lower the benefiting partially of component QX the network of offset ticket incentive component versus transaction the Finally, of interchange. sizes, gross profit fees because was transaction per

of out three that situations how new impacted were unique pandemic. end no us fourth year, we lap and Visa. our QX, impactful our relatively at contract business and accelerated The much these be coming because in shouldn't these of this XXXX, longer factors on all by re-occur the of of the will first once The will factor believe based with

XX%, margin QX incentive is the lowest year Gross the of margin of quarter because our was timing. typically

While the to due concentration less concentration volume steadily Block net improving over steady. and relatively business. Block non-Block quarters, revenue past the the is four the margins has Block business our within remained gross This profit favorable mix increased in has

margin concentration The is points weighing margin Block business. the XX is over than increasing lower overall revenue our of the since rest our

Our business profit about like than Block, items benefit, a the excluding faster whole. the unexpected half normalizing and times a Klarna incentive two QX and for gross growth, as is

are as than customers which at this year. start well still we is margins loss others, of than more from higher with Visa by growing renewals as lapping, offsetting of faster certain incentives the the the impact Driven

the expenses point QX Power. one a from of XX% of $XX inclusion of X% organic and last adjusted decrease year-over-year, decrease were growth a a by million, driven despite operating quarter

approximately headcount after late reduced expect reduction a rate in head a approximately savings resulting plan. restructuring we in areas net of X over XX% million. restructuring restructuring in savings QX going million workforce Our quarterly forward, new reinvest May pre our On of counting XX% priority basis the of in by run resulting we XX of

just the result restructuring. Our not expense QX in was of reduction

We efficiency have underway. initiatives many

QX year-over-year in last transaction technology versus SaaS include costs, growth and Cloud of XX%. Our year tool flat expenses, over which despite were

automation of to improving reviews leveraging thorough our uptime, are executing usage and and efficiency security performance. while We improve simultaneously our

share well is a We and as which million net restructuring with We related and of also forfeitures, continue headcounts contractors recorded from X all to of as base associated to and bonus such as our of operating expenses of be the and hiring reducing EBITDA. cost charge onetime release consultants. compensation usage adjusted excluded of severance, travel accruals mindful of

successes. million by expected gross was elevated income expense million. QX GAAP was Interest was onetime positive cost driven related QX a adjusted X.X%. the by interest non-cash million million, than acquisition one-time combination of profit as driven power and restructuring including $XX well EBITDA The This rates. management one to the net as post cost $X $XX growth million was loss margin result -- of better $XX loss

During of the stock XXX buyback QX, million. we announced

an investments. As of and We quarter million. million shares quarter billion average for of end, we price with $XX.X of for short term purchased XX.X $X.X cash ended $X.XX the

to renewal. Cash shift QX as the App let's our Now as outlook, well

set the me aside App about we of quarter trajectory. is a a than out talk Let minute for expected Cash The coming the a underlying business QX renewal briefly of the little performance and stronger business ago.

in dissipating of gross profit In QX the drags on growth QX. some addition, are in

lap of to the points some less the in volume QX single year. from heavy two versus and activity lapping renewal factors, of loss just QX drag expect starting the last Klarna We percentage high digits

to headwinds in XXXX, tiers profit more itself point from will timing but will through low that we digit We single incentive year ramp growth continue end. gross slowly correct QX as see percentage the in by

on excited we to as four enjoy the we growth recognize together. that and our Moving we enable years parties the the are Cash partnership and extend both to success renewal, App innovation another

the As our the and for our measures believe dollar the we growth is of rate, we gross Cash proxy given the impact profit is We much receiving profit Cash best earn anticipated, every to App of the impact for in renewal which App since to last gross price, economics measure our how TPV. improved XXXX. economic the take renewal way trajectory therefore

additional Cash of and accounting expect to QX market while XXXX, Cash we renewal. on believe We ahead profit both result of scale with the we be Looking earn provide to price volume gross QX approximately XX% take for the we and as for differentiated parties capabilities. services very commensurate rate this our fair App rates lower the is for App a platform

forward move to excited the for years. next four are We

two are to has important renewal The structural note. changes that

the start a we the we tiers. based and net volume In new starting between for construct. and charge network the tiers. We previously Cash determine the on App where services we aggregate on fees pricing then based First pricing at XXXX, pricing from bank will split used price together construct, fees construct, interchange interchange the Cash Marqeta App volume and provide July

not the use bank and by our more provide business mix construct passed in directly customers, it we several the business and for pricing factors. reducing We in to caused other is App. does price the Cash new already charge this construct how we fees the While volatility with a cases, while value interchange presented are few network change those This P&L. clearly defines

our is The consequential second change to structural presentation. revenue

App As is payment Cash responsibility the taking part of relationship. for network renewal, primary the

that relationship, they Cash this materially volume significant impact costs network, because payment of on in revenue therefore costs App Cash we relationship aspect P&L. in Apps provide the be longer our payment this be and support will the in net from primary revenue. still our do To same we reflected the presented zero presentation other But Cash be our expected will were this with XXXX. on is volume will Previously, of starting and reduce has revenue. level incentives substance the QX primary in network profit. were the reported net case change longer for While in of responsible no clear, it program, with every network on revenue gross receive That both cost these no associated App our although manage will not we change

our will the QX, times in of the XXXX renewal. net and perspective To put reduction of price the impact reduce by revenue impact QX Cash six of change the to approximately in net tied accounting amount the revenue the App

talk specifically let's outlook. our about QX Now

of me little let underlying thought what First, out stronger QX is ago. performance reiterate that quarter than of a business the we a the coming

impact plan our share renewal of given Second, to significance. quarters, for we four the next of the Cash App the each numbers the on

XX% Cash due net decline result shift QX to point is the to anticipated expected for with is Roughly contract the approximately impact of due XXs the as percentage the of to while terms, a expectations an are XX% mid follows; pricing and by accounting XX% our renewal Our renewal. revenue in remaining treatment. App is XX% new between

between with Gross Profit App XX% is an percentage expected due to and approximately decline point Cash the X% contract mid-to-high XXs renewal. to

Our gross margin be in should XXs. the low

the XX% organic of expenses expected to decline restructuring expect completed QX EBITDA we success an the Given operating be on well margin adjusted as to year-to-date, efficiency efforts, Therefore, as digit a by high negative basis, of to of is XX% our percentage. single adjusted the includes treatment half mid-teens to is acquisition. accounting denominator. in one lower the impact margin of because due point almost This approximately renewal, decline Power due excluding percentage App the point to new the negative the revenue Cash which in

due App change large decline treatment with year anticipate XXXX low a contract impact revenue that majority Cash Cash the an Cash performance a we Consistent thought will Compared is to to to gross five four be to the to which accounting QX, better heavy as be similar following; due better. renewal App little of expect XXXX. continue of percentage for points approximately a revenue be App our ago, both EBITDA renewal one is better lag We to we in QX revenue. by be anticipated percentage to better, growth Therefore, be to performance points to three point activity to impact the is we to two related profit be quarter in quarters. four to and for net low teens to the margin adjusted we full renewal, expected net the with XXs what than the expect expected QX in points

of an impact This an negative digits expected organic positive of to mid-to-high single an of negative mid-teens impact to negative Block accelerating on renewal, the the to decline App half expectations the the of App basis, margin, consistent the due innovation. been Cash to without Cash Gross run believe excluding new the low which while approximately approximately digits with Cash to margin be efforts, reduction low revenue This EBITDA the EBITDA a presentation App due the whereas this cost renewal. is at renewal. percentage achieved mid-single Cash for have negative we single and our and rate. digit is point This expect exit renewal, sales positive XXXX growth year, excluding point we is impact due the slowdown with EBITDA XXXX primarily is expected includes now approximately been to in Profit Adjusted low Without year, the with our a beginning Power to would expected the at EBITDA one acquisition. renewal. adjusted App margin year, have be positive to we even

making for strong delivered success. across to up, wrap long-term To we position progress and QX the metrics all a significant company have been

overall strong categories. restructuring reductions growth. as renewal diversify us as well we help to our establishes efficiency course, and long-term embedded profitable And baseline our a bookings efforts, business all Cash sets and up our new across on which show focus progress with App with of should for sustained expense on continue finance our opportunities, toward sustainable as operating Our our expanding capitalize growth made growth. We the momentum with strong significant goals

the beyond XXXX the Before the today's including great that Cash App exit impacts But XXXX will be are to call EBITDA. renewal great positive we performance business the we longer of not discussing Q&A, trajectory of fact a we go with term during interest. implication we will understand

longer to host term an to to plan more investor in we day the follow. QX with details However, discuss

over turn Q&A. to let's it Now

ahead. The with Tien-Tsin go question Instructions] [Operator from comes JPMorgan. Huang first Please

about about But benchmarking at so through I'm know and benchmarking I lot can good as Right the you here. you exercise stuff. on here, it it's afternoon. take numbers the exercise people a and But but of And Cash much. rate to know all renewal. the level Thanks publicly know I negotiate you. And are it, I to thanks and new and the the we we're all on the listening, going deal tough a shared talk too going high in the for just a pricing other the of competitors exercise. the and benchmarking to much, think understand about us renewal walk App. just love curious through little to dig clients, fairness? Thank etcetera. all the bit to general just stakeholders more as

question appreciate Thanks and be again. Tien-Tsin good talking to really the

it differentiation achieved commensurate parties. scale the extremely put what strongly me actually exactly is Marqeta this with difficulty] the the to and commensurate It the over [Technical Let the has for Cash is and value premium fair deal way. volume also the both that it believe was. App We that commands and

but would reasons there's say diversify. two So, I actually companies that

us to in the of of some the incentive the distribute is is that lot Right for both so a agreement one economical. your you the load like; like and vast the We've them And majority actually platform. form of stability, bake of redundancy work as which more volume. we've the One of of you done in redundancy. the on second stability providers kind multiple is the have on economical addressed capture and with

And we've demonstrated. something

reduced reasons something almost non-existent. to the So we've for diversification almost is, there

on of our eventually growth to gross terms going is believe One And how are to from gross gross profit that the going business. In we look profit. have, at three yes, we translate within that revenue that's come are and into exceeding is, we areas. bookings profit fundamentally

is our Cash grow. of And Block through plenty App, and opportunity Afterpay. through growth square one Second with to with continue through base there's will

that's the growth come from. expect what So growth, we gross profit to the

of meant much that, Tien-Tsin this weak their that's add process in weighing of that the would deals that Afterpay. then saw, about needed on coming over And absolutely you period, as timeframe really now, because when And when Yes, just pandemic, think sort as is of quarter four in renewed Cash of we've boomed. year. to that a And from renewed what's our were talked XX% customers growth just be QX the our it year, XXXX started of last right volume, our adjusted we the year, that businesses as this out growth we've only our of incredible non-Block business many stem about you well thing bigger. the I App we lot a ending does

So before, we've lot renewed of really grew. now incredibly a business we that of that just had the

momentum And grow have. combine that so once now term proposition. just we for the sales good how unique can scale value with differentiated that, we with and you because past platform just in, and have that's we we're on flexible credit. modern combination get the business longer contracts debit already the a our customers the very of And we of that global both It's

that's from, on the going profit four is much obviously, be just our change. from so noise to try the for you'll is best as is help come long gross business what in do going you revenue accounting focus to how But that the to next where there's how growth is sense to of And going growth, revenue. we coming performing. to the And as understand everyone quarters think we'll the a have

the you you a give ring to way. much. Thank Glad out so

Our Please comes Wolfe ahead. Peller with go Darrin question next from Research.

a does a post from or great dollars, little gross don't to profit to renewal it Congrats, Block annualized to like, of guys Maybe clear if more on on mind you pre actually vanilla either the basis. clarification second just your these what to be on just an bit in plain half basis XXXX announcements, just see. terms

just little on heard that then in I also can rate you about was impacts if maybe renewed think heard I bit. lot don't Just it then seller. down Cash about. the for App -- growth earlier, I you There us obviously moving talked a bring here. quickly, and parts And was a I and very Afterpay of think

So quick a guys. update. just Thanks,

so. Yes,

then take let it I'll So Afterpay and and about talk me hand part, the over to Simon first Square.

that And what in is profit to reduction our it's by mean way the about is a Darrin price. XX% rate. price, by take think our So the it, I gross

the how we let every this profit terms. took we said, dollar net to and that combine guess, used explain bank should take me And which we just and try our it best So case. interchange minute together the in I simple amount in measure network of fees I for the and interchange volume, is gross make and change, in mean, really of between to structure, accounting do essentially, App, that Cash what is to Marqeta? split right, we fees, then a

had be obviously, bulk of that fees it. we got in we they and and And network we were when those bank much for were split, determining the knew responsible But that to incorporated how fees we kept is what's because network not the pay revenue. going to now, we be are have structure, responsibility. the in in our of primary cost And a cost to new happening our

fact to revenue that cost. And so will to have to pay we're have for the in going what longer account our essentially book we no that

is reduced. revenue. so our significantly And revenue is But our is of so happens what cost

help so our this just the, very to as sort it meaningful, will of be but impact to not it's impactful the the gross four you, to for growth, normalize we'll best ultimately, the revenue over next to and And do profit, said, I quarters.

what would have before, net you than XX% in less I than, correct? but terms, Okay, otherwise net going earned gross of guess profit forward, less

right. exactly That's

you… Okay. Thank just then right. Simon if the on other you. later. That's side, And All

Block did we between ourselves. like, much before, I multiple Afterpay activity we times, think and going the reviewed Yes, on yes, so there's App. Cash partnership, And renew we said just

not seller And fluid very in So XXXX. due later till renewed it's situation. be to a is

seller. lot that. I we'll moment work of So daily And working very us well. and as a that and have they actually on every symbiotic great that App Cash expect Afterpay growth of be It's will now is then, The witnessed a happen fascinating. is celebrating a relationship. But again, between relationship. we're between It

it Okay, turn while vast of all. and and But gross combined the you contribution is just Blocks, at the App right? the back got to from your I'll the majority profit queue. to be clear Afterpay seller, the Cash

That's right, correct.

Okay, good. guys. All right. Congrats Thanks. again,

you. Thank

Please Barclays. with go El-Assal Ramsey from comes ahead. question next Our

Hi, this thanks for taking evening. question my

be question, revenue a little concentrations on on I here through lining lower contract wondering help Block thoughts your there? basis. the can versus the think be a a just will that your of a run concentration what percentage will Darrin's on of that up profit rate might non-Block. us you business sort Following assume, hypothetical gross But silver with, have overall this basis bit Block deal be and

the are And around that our Ramsey, going we based yes, on deal Yes, concentration of was fall to fall, this on expect likely percentage profit to concentration in this likely you XX points points. mid forward. sort correct, gross revenue what is XXs to percentage based is high

on. On, again, feel start the conversion had of those, you've quarter. show quarters we about you conversion, start terrific of of never maybe quarter three here that I end are period sales. event? bookings the sales kind ask earlier up to Or you've timing, then what And solid bookings a to the to Is an converting start before sales something year? and a XXXX revenues? this At the another us and still that to see can start had want three point question to Terrific. on really Remind

of we're think to before the you question. the actually, going I for start end Thank the something seeing It year.

a to for from they their average, programs commercial start days then guide days consumer between, there. then take to on [Ph] about XX ramping live Just then us XXX to and year program, launch go from take it call and and you, to them ram

giving be be tail seeing accelerated we're in is But the and And a bookings delivery priority to working it's the some So the team, end to accelerate this pressure why of start Ramsey, eyes oversized XXXX. program are that's sustainable all so wouldn't going on we're kind no on. bulk XXXX. those towards number, but for new delivery like the seen trickling delivery in less of growth of seen going us to

Fantastic. Well, on renewal. answers. congratulations Appreciate the your

you, Thank Ramsey.

Our Shirvaikar with next Ashwin go Citibank. question ahead. from comes Please

-- done. on this we And Thanks. congratulations add getting this getting my

you're signing looking on total but a sense? been if if those In the heard you've that is margin in this gross of of on part a your basis at profit do things to question of volume of leaning bookings just of and kind perfect towards percent the renewals that to add as I will maybe What the kind makes you're what a it's gross thinking is more that just terms range basis. to about you on on these happens thinking I don't forward right, color -- today of some newer know going

answer in Sure QX that we so the the to low Ashwin, said first part margin your expect be in I question to our the XXs. of

sort the our business about we of under our is is talked over Block As previously, XX%. margin rest of XX%

in in there lot more that talked past. lower than So high and margin and gap costs what was of by in fueled the the we've Block made XX% lot a the was network a margin about a

as from the there revenue for the our past. our costs non-Block be going those revenue going for removing now margin then both by company of so the is the in And well is to of cost as business more to reflective

And so that that's see. you what to expect should

finance portion embedded to to newer of that? break comment you the terms Simon overwhelming table us you just in for seemed your kind Understood. the regards back use the to for down types with of of and cases that bookings. bring of of maybe types being into that Could it sort of an functionality me going And

solutions; your retail one it at the but retail The you marketplace also absolutely. that and one create diverse of few diverse I’d on interacts core that perspective. the traditional there's news card the to co-brand cases is say the so a the is marketplace. us segment the a Sure with basically global they're use types is cases and coming broader the from are looking here based us three their use the first good for are and co-brand from

rewards the consumers the marketplace the to terms in especially and shop, as card go actually of of behavior is So changing.

seller they or So ours, is lending whether it's like it but last more financing. looking with [Ph] that creative thing the alive of card the or and second for least, sale not it something themselves bonus BMPL do us is do they're they whether partners

general. that cover all we the credit marketplaces because become attractive solution, these can retail we So bases of given our in to

capital that second large do a is for accelerated employ card liquid they work is or workforce growing I’d that marketplaces a sell say, wages something wage actually global. a use their working that very actually in case that's demand large that shift immediately I'd retailers whether get fast say pay contingency or used The at that access it's wage is getting or and case, a their strong burdening are a did in it's us access, without

thing Third defying those. is, payments expense management and card supply in

simplify given and economical to extending payments, the even in some others situation. Cards streamline supplier suppliers and credit card using order the So Visa Master and networks, to

that think you the more. the and of there's depths flavors of that a gives I breadths we're seeing, solutions lot some

I just looking in things more part second of of that didn't I And answer your question terms profit a of basis. Ashwin gross the realized on at

product on basis customers but businesses, margin dollar and normalize the between I right, much and a for we better also by look a right, more as evaluate and really like the that's us lens so at bidding don't managed business. what profit but might little structures is how for so in the you're think business helps profit to for making higher in by typically example, the profit volume we because take you existing very So that that much gross of we little business bit as gross can do profit our gross credit be which gross but you're have charge on, the focus on different it lower as things really cost we're that deliver money new when powered differences to well much so customers what that every debit a we you a have they're with comparable, margin the than so for revenue in the rate tend

Thanks. for that. Thank you

from comes Partners. question with go Craig ahead. FT next Our Please Maurer

taking the Brazil, Wanted Brazil to hi some of in thanks BIN Yes for ask sponsorship question. with and new pretty ask processors to about a market crowded wanted strong issue a is you're part be what the and Brazil motivation of expectations market seeing players looking might or are in and to from for that issue whether not demands Brazil your outside that thanks.

we Great, where we're is take does to since That are vast kind answer looking And pipe international resonates most that is fast. companies there will the great in to moving not to but today not Brazil what expanding agree, I where majority mean grow, are that the tractions. directly companies most that call of setting very of be European we're getting on a expand. the eyes companies customers domestic Brazil given U.S. we're their we And that's I or have brand our what we to of Brazil. question. say demand seeing Craig the is into you

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Thank you.

Please comes question from William Our with Bob go ahead. Napoli next Blair.

that this behind so post time looks this what when a kind I been and a working and clear Thank you're wasn’t long deal thoughts just like know thoughts you, now the behind get exiting from long-term you profitability this you. on Mike deal any think of perspective model and though and Simon, positive EBITDA growth is I just for any profitability to deal that you XXs, on good I positive you've deal mentioned deal, you. what yes on EBITDA had know on, post

Bob. question the for thanks Yes

I last continue to the were we is we the are as the continue added year. like to that innovate. well we built place. is benefits we in we've scale of this early look added feel that put about capabilities, talked components feel Last second risk past, done of guess and have piece. are moving where in have capabilities. will lot investment our until and the the business really support half and to growing foundations size may team, think both year we in we at addition our platform really in a the it like up that naturally we the power probably course And still money and XXXX anchor business of our the get acquisition as think which of in add we acquired was platform the all then I if we way products, up a and We sort I a consistent Power sort tenants will we the those to good has of key but capacity And you place of banking

slow able to pretty of can of deals past of our pushing if means the the these growth years that laughing going profitability to an progress in lot said are have in ascent to profit at make lot exciting that start capacity It's that incremental not we're we out and those platform we've all or is factors a So lot improvements these three of XX, quickly and high making a of growth have growth we then in we're be we two in, And so. be we some more we can to and lowering the the think the what combination XX do new we, it, investment a deals means slowing least we very of chunks, than year us are that without adding strong done you're to get going the to and so looking deliver. should we and that right. two you will XX, to may kicking growth ready given profitability more pace the be just a for at back sales see is this renewal deliver expense we've activity or

little the business. credit Power on and your guess just capability the see you. that color bit sell maybe how maybe is for you outlook I business Thank on up follow progressing and credit more and Power the a on cross how and on just

well. progressing Sure,

done the technology. So we've integrating

testing. start and APIs the get can customers our Now

been Marqeta nice credit the here, business. sell, manager. Bob, the cross thing is of terms in the in not So been program that has It has

right after So acquisition. our pipeline the start did not

Our pipeline up was actually before. booted

partnerships deals the have we're strong to in going the we close comfortable. of next you pipeline year. the very half if in We're So strong and

do fact credit Yes, bit a also we're do benefit acquisition getting the first, they may but debit in for the we And they feel they, and little is who only customers credit have the the looking the they but big could a product, us in the a to Yes, with you looking that vice thing big benefit. it also debit is know in and that sense a might prospective on may we halo versa, add, something do want say, might who seamlessly be benefit. as from road. is to customers we of I customers like they future do I be do could would that with or seamlessly Bob, that that the fact

credit just us helping And broadly more just sales. so that's sales, in also I think our not

Thank you.

Deutsche Keane Please comes Our from Bryan next ahead. go question Bank. with

Hi, guys. I'm also the echoed congratulations deal. my on

competitors. I then with work new or clarification, wanted in-house the contract work what scope Block from expected either going isolate to going of any. is And any loss the to business to Just try

good we believe anything don't in-house that going there's know about. question. I Good,

with to to lot innovative cool some Block from and we're of across doing there's talk dramatic changes it That about, months from So the worked to a next continuing months the a XX There's our programs day ranges perspective, the really six light in small see will partnership. is to lot and probably being strengthening on. products. and highly early but a board

transaction will App for it, renewal half the will positive contract business. past, grow the contract the will second this they growth a or once accounts get it of with anniversary Got of in grow How then aspect Cash And by, have the or Block in XXXX. got growth growth we it. we just

to you want it? Great take do question. Mike,

continue we'll to so Yes, grow.

have the set set Bryan a We believe way to where, we contracts it it to up these make win-win. up best is

a to way as bit, the to faster maybe they we that get little it's they still and a bigger, they the up pricing set is you to than accretive the try get little us, do. continue tiering So but grow

bigger as they they So nice should, they still more of the we a as get accrue growth well. little upside bit but get as

how And for parties. aligns tried really which to it both win so our set interests that's is up, and a we

much. so Thanks it. Got

Our Andrew Securities. comes from go with Truist Jeffrey Please ahead. next question

Hey the question. this lot access? Switching about call is primary Broche Thanks questions. Andrew. a for wage on is Julian of your here on on from some earned gears There's competition know touched taking the App What for it. Cash I them you here.

said You business. strong it's global strong. There was demand and

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specific. Now that's something

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clarification, helpful. Thank the you for that's it. Got

time question? last for Maybe one Sure.

Kupferberg Bank ahead. Please Merrill next question of Lynch. from go our Jason America Sure, comes with

Hey, thanks the taking question. is on this Kathy for Jason, Chen for

maybe about or any to TPV by, June Just you. quickly to share managed anything there? second powered trends, wanted ask quarter color you the can versus there size, around July or relative ticket Thank by

stable. of change the a are overall, in seeing business. the not say would meaningful trajectory the I We're trends

it as steady yes, So goes.

contribute quarter quarter, got Could that second little just benefits. not some you a in that how quick to bit could you clarify that, did for I incentive a third about guys growth into to jump if know in unexpected sneak follow continue the quarter, much had up, and profit expecting the elaborate to I Okay, correct? the you're you growth, just

correct. That’s

unexpected So our really expected how that is by we're roughly two gross profit business thirds more close in been talking we the owed and came with all contact had as these had faster incentives the networks growth was about about of and is in points we're than five of past. constantly together. that, that it incentives driven obviously we doing about part than discovered that the been paid actually we we And and

up appropriate discovery, from. part were, I that and was And so prior benefited that were, periods paid onetime compensation we we as guess, so, catch we a of our really that for just

it's So not that something reoccur. we'll

quarter. so thanks Great, on guys, the much, and congrats

we Maybe have more. do for time you. Thank one

questions There queue. no more No. in are the

Thank you. perfect. Oh,

Right.

So has today's session for Thank presentation. our been Q&A attending concluded. you

disconnect. now may You

Thank you.