The FinTech IPO index rises by 2.4% as the upstart increases in the sale of consumer loans
The FinTech IPO rallied 2.4% in a week that saw the last remnants of earnings reports trickle in.
And of course, beyond the revenues and various customer metrics described in these quarterly reports, there were firms that had their own headlines without revenues.
Upstart Stages Significant Rally
The upstart saw its shares rise 48% over the past five sessions. As announced Monday, Castlelake, an alternative investment manager, along with co-investor and minority partner Eltura Capital Management, entered into a pact to buy as much as $4 billion in consumer loans from Upstart.
“Through the transaction, Castlelake will leverage its experience in underwriting consumer credit and small business loans to provide Upstart with the opportunity to grow its business,” according to the companies’ announcement.
Shares in XP rose 5.7%. The company posted first quarter earnings it showed a 9% increase in client assets to 954 billion reais in Brazil. The company’s records show that active customers increased by 13% year-over-year (YoY) to 3.9 million. The pension plans’ client assets were 62 billion reais, an increase of 23%.
Riskified’s latest performance report — where gross merchandise value was up 20% to $27.2 billion in the latest quarter, and revenue rose 17% to $68.9 million, helped boost shares 18%. The management noted in its results material that during the last quarter Riskified diversified the platform with the introduction of new sellers across a number of verticals. Eight of the top 10 new sellers won during the first quarter represented categories outside of tickets and travel.
Some rejections among income reports
Robinhood’s stock fell about 11%. In our earnings coverage last week, balance sheet losses widened nearly a third (30%) to $511 million, much of it due to a hit from a one-time $485 million stock-based compensation charge, compared to revenue of $441 million, which was up 16% in the quarter.
Robinhood’s monthly active users (MAUs) increased by about 400,000 to 11.8 million for the most recent quarter, nearly half of the platform’s 21.3 million MAUs during the retail investment peak in Q2 2021.
The commerce app’s first quarter 2023 MAU of 11.8 million represents more than a quarterly (26%) decline in activity.
The platform’s annual net deposit growth was 29% for the quarter and 18% over the past year.
Shares of Futu Holdings lost nearly 10% over the past five sessions.
As reported earlier week of The Wall Street Journal, Futu is one of two brokerages listed on US exchanges (the other is Up FinTech Holding) to remove trading platforms from app stores in China starting this week.
The changes – which equate to a reduction in services in China – are those being made to comply with new requirements imposed by the China Securities Regulatory Commission’s requirements governing cross-border transactions, particularly where mainland customers had made cross-border transactions. acts. Futu, for its part, has said it would remove the Futubull app.
The company’s apps are used by Chinese customers to trade stocks and other holdings on international exchanges.
