Riskified Outperforms in Q1 Despite Bottom-Line Risks

Riskified Ltd. (NYSE: RSKD) has announced its first-quarter earnings results ended March 31, wherein both the top and bottom lines surpassed Street consensus estimates.

The Numbers

The ecommerce risk management platform provider recorded revenues of $58.85 million, which was above the average consensus estimate of $55.89 million. Moreover, revenues increased 15% year-over-year.

Riskified’s ticketing & travel category performed well on the back of increased merchant activities for airline travel bookings, event tickets, and similar products. This resulted in a whopping 291% year-over-year increase in the company’s total gross merchandise value (GMV) from this segment.

Moreover, the company also witnessed encouraging new merchant additions from various verticals like luxury fashion and fast fashion.

Further, non-GAAP net loss per share came in at $0.08, which was narrower than the expected $0.15. However, the metric was wider than the prior-year quarter’s net loss of $0.01.

Gross margin was 52% in the quarter, which was lower than the 56% gross margin recorded in the same quarter last year.

Coming to its liquidity position, the company’s cash and cash equivalents stood at $341.42 million, down from $418.14 million recorded in the previous quarter, i.e., Q4’21.  

For the full year of 2022 ending December 31, Riskified reiterated its previous guidance of revenues in the range of $254 million to $257 million.

Official Comments

Speaking on the driving factors of Riskified’s business, CEO and Co-founder Eido Gal said, “With the vast majority of merchants globally still relying on in-house solutions that we consider to be slow, inaccurate, expensive, and inflexible, we believe the market remains ripe for disruption. We are already seeing positive returns and momentum from our previous investments, and we remain focused on opportunities that we expect to deliver high ROI for Riskified.”

“These focused efforts include pursuing market share gains in new industries and new geographies, and continuing to expand our product suite to help merchants navigate adjacent eCommerce friction points,” Gal continued.

Wall Street Weighs In

Wall Street consensus is cautiously optimistic about Riskified, with a Moderate Buy rating, based on three Buys, one Hold, and one Sell. The average RSKD price target is $9.90, which indicates an upside of 110.19% from early Tuesday price levels.

Ending Note

Though the earnings results were better-than-expected, several headwinds weighed heavily on the bottom line. It remains to be seen what analysts think about the performance and outlook of Riskified.

Discover new investment ideas with data you can trust

Related News: 
Tencent Music Murmurs Decent Quarterly Numbers

AerCap Stock Rallies 6% after Adjusted Earnings Beat Expectations

Eli Lilly’ Mounjaro Injection Bags FDA Approval