Sezzle 3Q merchant sales up 21pc, besting Splitit's third-quarter growth

Sezzle’s underlying sales in the third quarter grew 21 per cent to $318m, while Splitit’s underlying sales were up 8 per cent quarter-on-quarter to $99m
Sezzle had 1.8 million active consumers as of September 30, compared to Splitit’s 186,000
But Splitit says it has added a number of new larger merchants recently

Buy now, pay later operators Sezzle (ASX:SZL) and Splitit (ASX:SPT) have both reported strong third-quarter numbers, although the market seems a bit more impressed with Sezzle’s figures than Splitit’s.

Sezzle said it had processed $US228m ($318m) in underlying merchant sales for the quarter, up 21.4 per cent from the second quarter. That’s an annualised run rate of $US985.9m, putting the payment processor on pace to easily achieving its year-end goal of $US1bn.

In contrast, Splitit processed $US70.9m ($99.4m) in merchant sales for the September quarter, up 8 per cent from the June quarter and up 214 per cent from a year ago. But the company said a number of new larger merchants launched with Splitit late in the quarter.

Sezzle said it had 1.79 million active consumers as of September 30, up 21.5 per cent from three months prior and up 178 per cent from a year ago. It had 20,890 active merchants, up 29.7 per cent from June 30 and up 178 per cent from a year ago.

Splitit had 186,000 active shoppers as of September 30, up 25 per cent from June and up 48 per cent from a year ago. It had 1,400 merchants, up 31 per cent from June 30 and up 90 per cent from a year ago.

By midday Sezzle shares were up 7.5 per cent to $8.60 while Splitit was down 0.9 per cent to $1.59.

Sezzle has a market capitalisation of $870m, while Splitit is valued at $709m.

“Our strong performance in 3Q is reflective of an improving Sezzle consumer profile along with the continued acceleration of ecommerce in the marketplace,” Sezzle chief executive Charlie Yoakim said.

Splitit chief executive Brad Patterson said it was a “record quarter with rapid growth” for the company. Its merchant self-onboarding has now gone live in the US, following beta testing in the third quarter, with other markets to follow this quarter and next.

Splitit booked gross revenue of $US2.4m ($3.4m), up 318 per cent year-on-year. Sezzle did not report revenue.

During the quarter Sezzle partnered with Ally Lending, which will provide a long-term financing solution to merchants and consumers.