Collaboration Can’t Save Marqeta From Q3 Stock Rout

Card issuing platform Marqeta touted its upcoming collaborations — including a launch with VisaFlex Credential this week — during its third-quarter earnings call on Monday (Nov. 4).

The company missed analysts’ expectations, and Wall Street punished its stock, dropping the price almost 32% in trading throughout the day. Despite the earnings miss, company officials told analysts they expected to see growth, especially as the connected economy and demand for digital payments grows.

“The days are numbered for the status quo as consumer and businesses want modern financial products,” Marqeta CEO Simon Khalaf said during the earnings call for the quarter ending Sept. 30.

“The modernization of payments started more than a decade ago on the acquiring side but has gained momentum on the more complex issuer processing side in the last five years. Despite the great progress we made, this transformation is still in its early stages. And Marqeta currently accounts for only about 2% of the issuer processing volume in the markets we operate.”

In responding to a question during the earnings call, Khalaf said Marqeta is preparing to launch a solution using Visa Flexible Credentials this week.

“We are in the midst of a launch, as in like going live, and we expect that actually to happen either tomorrow or Wednesday,” he said. “And we’ll start into the ramp phase on [Nov. 15].”

In May, Visa announced its Flexible Credentials offering, which lets users access several accounts and toggle between payment methods, including credit, debit and BNPL.

Last week, Marqeta also introduced Marqeta Flex, a new solution designed to increase the availability of buy now, pay later (BNPL) options for consumers. It allows consumers to see personalized BNPL options within their payment apps and gives more access to BNPL providers for card issuers and digital wallets.

By the Numbers

The company reported a 30% year-over-year increase in total processing volume (TPV), reaching $74 billion. Net revenue climbed 18% to $128 million, while gross profit surged 24% to $90 million.

Khalaf attributed the positive results to operational discipline and the launch of innovative new products. “Our true growth trajectory was back on display as we lapped the Block contract renewal,” Khalaf stated. “We combined this with several new product announcements that further enhance the Marqeta platform to provide transformative payment solutions at scale.”

Recent Product Highlights

Marqeta pointed to recent solutions as examples of its momentum and continued growth:

Marqeta’s new Portfolio Migration service simplifies the process of moving existing card programs to their platform. This was proven by the successful migration of millions of Klarna cards.

Marqeta Flex offers a new way to integrate BNPL options into payment apps and wallets, increasing accessibility and personalization for consumers. Affirm and Klarna are the first BNPL providers to use this solution.

The UX Toolkit provides customizable components for building modern payment interfaces, allowing Marqeta’s customers to create better user experiences with less development effort.