BNPL Firms Save the Day as CE 100 Breaks Even for Week

It doesn’t have a dedicated heading in the Connected Economy, but the Buy Now, Pay Later sector of the “pay and get paid” pillar tore up the track last week. Solid Q2 earnings performances from Affirm and Sezzle led the CE 100 to a flat performance for the week that ended August 30, and a 3% gain for the month. Stock price declines from Pinduoduo and Vroom weighed on what would have been a positive week.

Affirm posted a 40% gain in share prices, followed by Sezzle at 6.5%. Having covered both company’s earnings recently, we won’t repeat them here. Instead we will focus on other notable performances from the CE 100 for the week, led by database platform MongoDB and home insurance/improvement platform Porch Group.

MongoDB reported solid Q2 FY25 results on August 29, leading to a 17.4% share price increase. It reported revenue reaching $478.1 million, a 13% year-over-year increase. The company’s strategic focus on AI integration and legacy system modernization resonated with customers, as evidenced by the successful launch of the MongoDB AI Applications Program (MAAP) and continued recognition as a leading vector database provider. While non-GAAP operating income and net income decreased compared to the previous year, the company believes its cash position, growing customer base, and strategic partnerships with major cloud providers position it well for sustained growth in the expanding database market.

As Dev Ittycheria, President and CEO of MongoDB, stated, “We remain excited about our opportunity to continue capturing share in one of the largest markets in software. Today, companies of all sizes and across nearly every industry and geography rely on MongoDB to build the software that helps them run and transform their business. We believe we are incredibly well positioned to help customers incorporate generative AI into their business and modernize their legacy application estate.”

Porch Group, a homeowners insurance and vertical software platform, posted a 7.5% increase a few weeks after reporting second quarter results with total revenue of $110.8 million, an increase of 12% compared to the prior year. The company’s insurance profitability actions continued to result in attritional losses performing better than anticipated, offsetting the severe Houston catastrophic event in the second quarter. GAAP net loss was $64.3 million, compared to a GAAP net loss of $87.0 million for the second quarter of 2023. Adjusted EBITDA Loss was $34.8 million, a $8.4 million improvement from the prior year.

PDD Holdings, the parent company of Chinese eCommerce site Temu, got caught in a typical “good news, bad news” situation reporting strong financial results for the second quarter of 2024, but the stock tanked on a weak outlook for the balance of the year. As reported on Monday August 26, total revenues increased 86% year-over-year to RMB97,059.5 million (US$113,355.8 million). This growth was primarily due to the increase in revenues from online marketing services and transaction services. Operating profit also increased significantly, by 156% year-over-year to RMB32,564.5 million (US$4,481.0 million). However, the company expects to face challenges in the future, including intensified competition and external challenges, but is committed to transitioning toward high-quality development and fostering a sustainable ecosystem. The stock plunged 31.3% for the week. 

Used car digital marketplace Vroom lost 16% for the week and affected the CE 100 as it continues to draw down its inventory. The company announced that it will stop buying and selling vehicles as of Jan. 22.

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