Insights

Afterpay (ASX:APT) share price slips as CEO spruiks company’s new direction

What did Afterpay’s top executive have to say after the company posted its FY21 results this week?
The post Afterpay (ASX:APT) share price slips as CEO spruiks company’s new direction appeared first on The Motley Fool Australia. –

The Afterpay Ltd (ASX: APT) share price has finished the trading week with more of a fizzle than a bang.

Afterpay shares slid well into the red in the latter part of the week after the buy now, pay later (BNPL) company reported its FY21 earnings on Wednesday.

At the market close today, the Afterpay share price was trading down 1.71% at $130.16. This was just 0.5% higher than last Friday’s closing price.

The main takeaway from the company’s FY21 report included a 13% decrease in earnings before interest, tax, depreciation and amortisation (EBITDA) and a statutory after-tax loss of around $160 million.

This was despite a 90% year on year growth in sales revenue and almost 80% gain in total income.

What did Afterpay’s co-CEO say?

Afterpay co-founder/CEO Nick Molnar defended the statutory loss on Bloomberg TV on Wednesday, saying many non-cash items were essentially one-offs. This included the revaluation of the company’s minority interest in a UK entity.

Molnar added that it was unsurprising to see a minor slowdown in customer growth in Australia versus other markets, given the company’s maturity in the ANZ market in FY21. In contrast, Afterpay saw more than 100% customer growth in its US segment over the past 12 months.

Moreover, he said Afterpay continued to see “top-line” revenue growth as “frequency does continue to accelerate” in the Australian market, in addition to its other segments.

What about the Square Inc deal?

Regarding Square Inc’s impending acquisition of Afterpay, Molnar said the focus was to “align values and principles”, with Square starting from the same fundamentals as Afterpay.

The BNPL company’s top executive said the prospects were “really exciting”. This included the ability to “leverage millions of retailers” (Square’s sellers) and more than 70 million users on Square’s cash app, to accelerate its growth in North America and the globe.

However, Molnar added that Afterpay’s push was as much of a marketing play as it was in retail, as the company sent “over a million leads a day” to its retail partners over the last year.

According to Molnar, this differentiated the company as not just a “payments infrastructure” provider. It was also a “marketing engine” to the hard to reach Millennial and Gen Z consumers.

Afterpay share price snapshot

The Afterpay share price has had a choppy year to date, posting a gain of 10% since January 1. Despite this, Afterpay shares have climbed 43% into the green over the last 12 months.

This result has outpaced the S&P/ASX 200 index (ASX: XJO)’s return of around 23% over the last year.

The post Afterpay (ASX:APT) share price slips as CEO spruiks company’s new direction appeared first on The Motley Fool Australia.

Should you invest $1,000 in Afterpay right now?

Before you consider Afterpay, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Afterpay wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

How does Afterpay (ASX:APT) earnings result compare to Zip?
ASX 200 rises, WiseTech soars, Zip drops

Got Afterpay (ASX:APT) shares? Here’s what to look out for in FY22
How does the Afterpay (ASX:APT) result compare with broker expectations?
ASX 200 midday update: WiseTech rockets, Afterpay & Zip report

The author Zach Bristow has no positions in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended AFTERPAY T FPO. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!