Sezzle Inc. reported third‑quarter 2025 results that surpassed expectations on both top‑line and bottom‑line metrics. Revenue rose to $116.8 million, a 67 % increase from the $70.0 million reported in Q3 2024, and gross merchandise volume reached $1 billion for the first time in a single quarter. GAAP earnings per share were $0.75, beating the consensus estimate of $0.65 by $0.10, or 15.4 %.
Revenue growth was driven by a 30 % increase in subscription revenue and a 25 % rise in AI‑driven services, offsetting a modest decline in legacy merchant fees. The $1 billion GMV milestone reflects a 40 % jump in transaction volume, underscoring the platform’s expanding merchant network and consumer adoption.
Operating margins improved to 22.0 % from 20.5 % in the prior year, while adjusted profit margin fell slightly to 21.8 % from 23.8 % due to a higher provision for credit losses. GAAP profit margin rose to 24.5 % from 22.0 %, reflecting stronger pricing power in high‑margin subscription and AI segments. The company maintained disciplined cost growth, keeping marketing spend growth at 12 % versus revenue growth of 67 %.
Management raised its full‑year 2025 adjusted EBITDA guidance to $175 million–$180 million, up from $165 million–$170 million, and previewed adjusted EPS guidance for 2026 at $4.35. The company reiterated its focus on scaling subscription services, which it views as higher‑lifetime‑value drivers, and announced progress on an industrial loan company charter to support future growth.
CEO Charlie Youakim said, “Our products continue to resonate with consumers, and crossing the $1 billion GMV threshold confirms the momentum of our subscription strategy.” He added that the firm will “use On‑Demand selectively to court large merchants while pushing most consumers toward subscriptions to lift revenue and earnings over time.”
Investors responded positively to the results, citing the strong revenue beat, the first $1 billion GMV quarter, and the upward revision of guidance. Headwinds noted by management include economic uncertainty, increasing competition in the BNPL space, and a higher provision for credit losses, which the company expects to manage through tighter underwriting and cost controls.
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