Amsterdam-based fintech unicorn Adyen published its shareholder letter and financial statements for H2 2022 on Wednesday. The letter focuses on the company’s activities, finances, growth pillars, and more.
Here are the seven most important takeaways from Adyen’s H2 2022 financial results.
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Processed transaction
During the 2nd half of 2022, Adyen processed 421.7 billion euros, an increase of 41 percent year-on-year.
For the full year, Adyen processed 767.5 billion euros, up 49 percent year-on-year.
According to the report, ‘Digital’ remained the largest volume contributor overall, realizing €253.8 billion in H2 and €471.4 billion for the full year, accounting for 61 percent of total processed volume in 2022 and 46 percent year-on-year growth .
Unified Commerce volumes totaled €116.1 billion in H2 and €196.2 billion for FY, which was 26 percent of total processed volume in 2022 and up 67 percent year-on-year.
Platforms contributed €51.8 billion in H2 and €99.9 billion for FY, accounting for 13 percent of total processed volume in 2022 and growing 31 percent year-on-year.
“Taking eBay volumes out of the equation, platforms would have been our fastest growing pillar at 79 percent in H2 and 95 percent for the full year,” the report said.
BUCKET
Point-of-sale (POS) volume was €67.6bn in H2 and €112.5bn for the full year, up 74 per cent, accounting for up to 15 per cent of total volume processed in 2022 – up from 13 per cent in 2021.
Image credit: Adyen
Net income
Adyen recorded a net income of €721.7 million in H2 2022, a growth of 30 percent year-on-year.
For the full year, the Dutch unicorn’s net income came in at 1.3 billion euros, up 33 percent year-on-year.
The company says the majority of net income came from its land-and-expansion commercial strategy.
The report has diversified net revenue contributions regionally in the second half of 2022, with North America and APAC showing the greatest acceleration.
EMEA contributed 55 percent of total net revenue, followed by North America (27 percent), APAC (11 percent) and LATAM (7 percent).
For the whole year, the net income contributions were:
€746.8 million in EMEA
€343.2 million in North America
€142.4 million in APAC
€97.8 million in LATAM
“H2 2021 was an exceptionally strong period for EMEA contributions, which impacted H2 YOY growth rates,” the report said.
Operating costs
Total operating costs for Adyen in H2 2022 were €387.7 million, up 78 percent from H2 2021.
Employee benefits were 222.1 million euros in the second half of 2022, an increase of 83 percent year-on-year.
Sales and marketing amounted to €31.4 million in the second half of 2022, up 64 percent year-on-year.
Full year 2022
Operating costs for the full year were €665.4 million, up 64 percent year-on-year.
Employee benefits for the full year are €380.6 million, up 58 percent year-on-year.
For all of 2022, sales and marketing were €55.6 million, up 53 percent year-on-year due to investment in brand awareness and hosting events to meet customers in person again.
EBITDA
EBITDA was €372M in H2 2022, up 4 percent from €357.3M in H2 2021. EBITDA margin was 52 percent in H2 2022, compared to 64 percent in H2 2021.
Full year 2022
For the full year, EBITDA was €728.3 million, up 16 percent from 2021. Full-year EBITDA margin is 55 percent, compared to 63 percent in 2021.
Free cash flow and CapEx
Adyen’s free cash flow was €298.1 million in H2 2022, down 7 percent from €320.2 million in H2 2021. The free cash flow conversion ratio was 80 percent in the second half of 2022, down from 90 percent in H2 2021.
CapEx was €59.1M, and 8 percent of net revenue, up from 6 percent of net revenue in H2 2021.
Full year 2022
The conversion ratio for free cash flow for the whole year was 83 per cent, down 8 per cent on an annual basis.
For the full year, CapEx was €99.1 million, and 7 percent of net income.
Image credit: Adyen
Adyen’s financial goals
According to Adyen, it has not seen any development in the business during the second half of 2022. As a result, the company’s financial targets remain unchanged from the last time they published results.
They are:
To continue to grow net income and achieve a CAGR between the mid-twenties and low thirties.
To improve the EBITDA margin and increase to levels above 65 percent in the long term.
To maintain a sustainable investment level of up to 5 percent of Adyen’s net revenues.
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