Earnings call transcript: Adyen Q1 2025 sees strong revenue growth

Adyen NV, with a market capitalization of $49 billion, reported a robust 22% year-over-year increase in net revenue for the first quarter of 2025, driven by significant growth across its digital, unified commerce, and platform pillars. Despite the positive revenue performance and strong financial health score of "GOOD" according to InvestingPro, Adyen’s stock experienced a decline, with shares dropping 5.58% in the open market to $1,555.13, reflecting investor concerns amid broader market uncertainties. Analysis suggests the stock is currently trading below its Fair Value.

Key Takeaways

• Adyen’s net revenue increased by 22% year-over-year in Q1 2025.
• Platforms segment saw the highest growth at 63%.
• Stock fell by 5.58% following the earnings report.
• New product launches and innovations are driving growth.
• Macroeconomic uncertainties did not significantly impact performance.

Company Performance

Adyen demonstrated strong company performance with a notable 22% increase in net revenue compared to the same quarter last year, maintaining its impressive 30% five-year revenue CAGR. The growth was broad-based, with Europe and North America leading the charge. The Platforms segment was particularly impressive, achieving a 63% year-on-year increase, followed by Unified Commerce at 31%, and Digital at 13%. This growth highlights Adyen’s ability to capture market share across various sectors and geographies, supported by healthy profit margins of 65.57% and strong cash flows that easily cover interest payments. InvestingPro subscribers can access 8 additional key insights about Adyen’s financial performance and growth potential.

Financial Highlights

• Revenue: Increased by 22% year-over-year in Q1 2025.
• Digital segment growth: 13% year-on-year.
• Unified Commerce growth: 31% year-on-year.
• Platforms growth: 63% year-on-year.

Outlook & Guidance

Trading at a P/E ratio of 46.35, Adyen remains optimistic about its growth trajectory, expecting a slight acceleration in net revenue growth for the remainder of 2025. The company is confident in gaining wallet share with existing customers, although it acknowledges potential growth challenges if market volumes slow. With a strong Altman Z-Score of 7.63 indicating solid financial stability, Adyen continues to invest in its platform and embedded finance capabilities, which are expected to drive future growth. For detailed analysis and comprehensive valuation metrics, investors can access Adyen’s full Pro Research Report, available exclusively on InvestingPro.

Executive Commentary

Ethan, Adyen’s CFO, highlighted the continued adoption of new products like Adyen Uplift and intelligent payment routing for U.S. Debit, emphasizing their role in driving growth. He stated, "The biggest part of our growth continues to come from increasing share of wallet," indicating a strong focus on expanding within existing customer accounts. Ethan also expressed confidence in Adyen’s ability to support customers across various markets, regardless of potential trade disruptions.

Risks and Challenges

• Macroeconomic pressures could impact consumer spending and transaction volumes.
• Increased competition in the payment processing sector.
• Potential regulatory changes affecting financial technology companies.
• Currency fluctuations impacting international revenue streams.
• Dependence on continued technological innovation to maintain competitive edge.

The Q1 2025 earnings call underscored Adyen’s strong performance and strategic initiatives, although market reaction suggests investor caution amid broader economic uncertainties. Adyen’s focus on innovation and customer expansion positions it well for future growth despite potential challenges.

Full transcript - Adyen NV (ADYEN) Q1 2025:

Maggie O’Donnell, Investor Relations, Adyen: Good afternoon, everyone, and thank you for joining Adyen’s Q1 twenty twenty five business update call. My name is Maggie O’Donnell. I’m part of the Investor Relations team, and I’m happy to be joined today by Ethan, our CFO. In today’s call, we’ll discuss Adyen’s financial and business updates from the quarter, followed by a Q and A segment. As the session will be slightly shorter than our half yearly earnings presentation, we ask you to keep your questions to a maximum of two per person that we can respond to as many of you as possible.

When submitting your questions, please use the Zoom Q and A functionality rather than the raised hand option. And as always, we ask that you include your full name and the firm you represent when submitting your questions. With that, let’s get started. Ethan, what are your key takeaways from the quarter?

Ethan, CFO, Adyen: Yes, sure. Thanks, Maggie. During the first few months of this year, we saw solid growth, in line with our expectations, mostly driven by continued wallet share gains with our existing customers. This can be seen in our net revenue growing 22% year over year. Our growth this quarter was broad based, reflecting an increasing diversification not only across pillars but also across regions, with Europe and North America growing the fastest.

All in all, we’re pleased with our progress and confident in the direction that we’re heading.

Maggie O’Donnell, Investor Relations, Adyen: Great. Thanks, Ethan. That’s helpful context. Can you give us the key takeaways for the pillars in Q1?

Ethan, CFO, Adyen: Yes, absolutely. But before we dive into the pillar updates, I wanted to highlight that we are now also reporting net revenue by pillar. Because pricing is driven by the size of the customer, we focus on absolute net revenues as a business. Net revenue provides a more accurate view of our underlying performance and the value we create. We believe this change will give you greater clarity on the key drivers of our growth.

We’ll continue to report process volume by pillar as well through 2025. On to the developments in the pillars. Starting with our most established pillar, digital. It remained a key contributor thus far this year. Net revenue was up 13% year on year, driven by continued momentum in verticals like content and subscriptions.

We’re seeing continued adoption of products like Audgen Uplift and intelligent payment routing for U. S. Debit. These solutions help our customers balance performance, cost and fraud, highlighting the value of our platform and our commitment to ongoing innovation. Turning to Unified Commerce.

Net revenue for the pillar was up 31% year on year, reflecting strong momentum across a diversified array of verticals. While retail continues to be a significant part of the mix, newer verticals, including food and beverage and hospitality, were among the fastest growing this quarter, underscoring the broadening relevance of our offering beyond our historic core. And finally, platforms. Net revenue was up 63% year on year, reflecting solid underlying momentum, particularly as SaaS platforms further embed payments. We now have 30 platform customers processing over €1,000,000,000 annually, up from 19 a year ago.

This milestone demonstrates the strength of our value proposition for platforms looking to embed these services into their core offerings. In short, in Q1, we delivered a solid broad based growth across each of these three pillars.

Maggie O’Donnell, Investor Relations, Adyen: Thanks for that summary, Ethan. I’d like to shift gears for a moment and touch on the broader environment. How are you thinking about the current macroeconomic uncertainty as it relates to Adyen’s outlook?

Ethan, CFO, Adyen: Yes, sure. It is true that there is more uncertainty around the macroeconomic outlook. At the same time, thus far this year, our performance is in line with our expectations. The biggest part of our growth continues to come from increasing share of wallet, and our view on this opportunity going forward has not changed. This is what gives us the confidence in our ability to deliver now and over the long term.

A smaller yet meaningful portion of our growth is inherently linked to the performance of our customers. When we shared our H2 twenty twenty four results earlier this year, we shared that we anticipate a slight acceleration in our 2025 net revenue growth, driven by wallet share gains with existing customers. Included in this expectation is the assumption that our customers will continue to grow at a stable pace. While we focus on further driving these wallet share gains, that acceleration may become harder to achieve should market volumes slow in the year ahead. That said, our three financial objectives remain unchanged, and we are confident we are well positioned to navigate what lies ahead for this year and beyond.

Maggie O’Donnell, Investor Relations, Adyen: Great. Thanks for that recap, Ethan. We now transition to our Q and A segment. We’ll get to as many as we can with the time remaining and otherwise we’ll follow-up directly to those who submitted. Following the call, the IR team will of course be available to respond to any outstanding queries.

Let’s take a look at the questions we’ve received. The first question comes from Mohammed Moawala at Goldman Sachs. Mo, can you unmute yourself and go ahead and ask your question, please? Moe, are you able to unmute yourself?

Mohammed Moawala, Analyst, Goldman Sachs: Yes. Hi. Can you hear me?

Maggie O’Donnell, Investor Relations, Adyen: Yes. We can hear you.

Mohammed Moawala, Analyst, Goldman Sachs: Great. Hi, I had a question. Firstly, on the quantum of the acceleration that you anticipate, I think earlier in the year, you talked about roughly around 100 basis points. I appreciate there’s a lot of moving parts. The macro environment, as you said, is more uncertain.

Do you still expect a quantum of acceleration this year? And if you can help us understand what would help you get to that kind of 100 basis points or perhaps below? And under what scenario would you perhaps not achieve this acceleration? The second question was really around eBay. There was a significant ramp down in share of wallet.

Can you help us understand what’s going on here and how that should evolve over the midterm? Thank you.

Ethan, CFO, Adyen: Yes, sure. First, on how we talked about acceleration in 2025. So if I go back to February in H2 when we were reporting H2 twenty twenty four, we were talking about what do we expect for the year ahead. And we’ve been talking consistently about the fact that we expect increasing acceleration in our net revenue growth driven by wallet share gains with our existing customers as well as new wins as we add them to platform, similar to what we saw in 2024 when we grew from 22% to 23%. We also talked about how that was connected to relatively stable growth within our customer base.

And so when we look at how the business is performing so far this year, we see strength in the performance against expectations that we had for the first months of this year. And when we look ahead into the opportunity to gain wallet share and how our pipeline is developing, that all looks strong comparably to where we’ve been at. So there’s nothing that’s changed in our thinking based on what we’re seeing on the platform today. What we also wanted to give a bit of insight into is that there is a portion of our growth, which is connected to our own customers’ growth. And we’ve talked about it in past presentations, talking about the building blocks that make up our growth.

And given that there’s more uncertainty in the macroeconomic outlook, we wanted to share that, that acceleration could become more challenging should their growth slow down. At the same time, it’s not what we see. Today, we absolutely see that the growth is in line with our expectations, the share of wallet opportunities that we’ve looked at for the rest of the year. We’ve also recently relooked at, again, as an organization, as a company, we are in constant contact with our customers, and that all is trending as we would expect. So I think that gives us the confidence that we’re really well positioned to grow not only in 2025 at the rate we’re expecting but also in the years beyond.

Then the second question you have around eBay. So I think we’ll stay away from talking too much on single customers, but I think what I can share, and that’s similar to what I’ve been sharing over the last couple of years, is that there’s a few payment methods which you can work with directly. I think PayPal, Amex, those are typically the biggest ones. Or you can work through a PSP like Audgen. This is the cause of the swings in volume on the ex eBay side.

At the same time, our on the eBay volumes. If you look at our ex eBay volumes in platforms, they’re growing at 63%, growing strongly. I think the traction that we have there in general is really in a good place. Similarly, we’re growing at that rate on a revenue side. So I think we’re really well positioned broadly in platforms to continue to have that drive our growth through part of this year, of course, and into the years ahead.

Maggie O’Donnell, Investor Relations, Adyen: Thanks, Moe. The next question comes from the line of Adam Wood at Morgan Stanley. Adam, can you unmute yourself and ask your question, please?

Adam Wood, Analyst, Morgan Stanley: Yeah. Perfect. Thank you very much for taking the question. Maybe just first of all, that’s reassuring on the macro side just to have you clarify that, Ethan. I guess the other question becomes on the pace of wallet share gains, how a weaker macro could potentially impact that.

Could you maybe just help first of all in prior cycles, how that’s trended? And then maybe you’ve made a lot of effort on the TCO side to help merchants that. Is there an argument that this could be better this time around because you’re able to help more with TCO and a weaker macro that focuses merchants on that would actually play into the development work and sales work that you’ve done over the last couple of years? And then maybe just secondly, the take rate on platforms is lower than the group and lower than the other two businesses. I guess the conversations we’ve had with people in the industry has been that platforms potentially could be higher take rates because there is more complexity around onboarding, managing payouts, etcetera.

And over time, you could potentially also onboard SMBs with a higher take rate. Is a lower rate there today just that you’ve got very big merchants at

Hannes Leitner, Analyst, Jefferies: an early

Adam Wood, Analyst, Morgan Stanley: stage that impact that and the complexity of managing the platforms and the SMB ramp up is still to come? Thank you.

Ethan, CFO, Adyen: Yes, thanks. So first on the pace of share gains. So again, we’re very enterprise focused as a business, which means we’re in constant dialogue with our customers. Of course, that means that we’re talking about still what are their priorities for the rest of the year, what are the opportunities that we have to grow together. And we look at that on a total basis for the rest of 2025.

That looks very similar again to where we were a few months back. So we feel really well positioned to continue to gain that share with our customer base. We see the same on the pipeline side, so for new business. So as we’re, of course, building out, working with existing customers, we’re also very much focused on how do we add new customers to the platform. And those discussions are also trending in the same way that we expected a few months ago.

So nothing really to flag on that side. How has it trended in prior cycles? I think we’ve proven that we have strong and resilient growth through multiple cycles that we’ve seen over the last years. We have quite a diversified merchant base. We’re not only diversified across verticals, but we’re also diversified across geographies.

Your question around TCO in a weaker macro, I think we’ve been in constant discussion with our customers for the last years. So this is not a discussion that went away and may come back. This is something that we’ve always been discussing with our customers. Take a product like Odjen Uplift. It’s very much focused on the balance between performance, between costs, between fraud, not sacrificing one for the other, but really bringing indeed that whole total cost of ownership perspective to the choices that you make within payments.

And that’s landing very well. Something like U. S. Debit also positions us really well. It’s not only reducing costs, but doing that without sacrificing performance.

And that combination is really important for our customers and something that I expect they’ll continue to be focused on as they have been in the last couple of years. If you talk about take rates amongst the pillars, indeed platforms is a lower take rate if you look at it amongst the three. That’s driven by the size of the customers. So indeed, you mentioned a few other services. There are more services or products typically that we can offer a platform.

So to your earlier point, I think it is logical to assume that there’s more ways to monetize. But at the same time, these platforms bring a lot of volume to the table. We’ve talked about 30 platforms processing over EUR 1,000,000,000 in volume as of this quarter compared to EUR 19,000,000,000 in the year before. So there is real scale that these platforms bring. And it’s just more concentrated to date given that it’s the newest and smallest pillar of the three.

But I think your assessment that there’s more opportunity to monetize amongst platforms is true.

Maggie O’Donnell, Investor Relations, Adyen: Great. Our next question comes from Justin Forsyth at UBS. Justin, please go ahead and unmute yourself and ask your question.

Justin Forsyth, Analyst, UBS: Great. Thank you so much. Can you hear me well?

Maggie O’Donnell, Investor Relations, Adyen: We can hear you.

Justin Forsyth, Analyst, UBS: Great. I don’t know if it’s just me, buddy. I’m getting a little bit of feedback on the line. I’ll just say that for the benefit of others. I have two questions here for you.

So first one, I was just wondering if there’s any given number for macro. So you’re more or less going ahead and reiterated that 24% number. I I think what some might fear is that the reiteration of that, if we assume our base case is for a lower macro or a worse macro in two h, that more or less the 24% is the upside case and that we’re talking about something perhaps in the low twenties as the the real base case. So maybe you could talk a little bit about the moving pieces within the macro. Is there a little bit of give in that number, that 24 number?

Or or sorry. It wasn’t exactly 24. It was a slight acceleration as you worded it, which maybe you put at 24. If there’s any give in that number, and particularly given we’re expecting, I think, a higher exit rate, all else equal, as Cash App and maybe eBay comps get a little bit easier in the back half of the year, just talking us through the moving pieces there. The second question relates to platforms and more specifically capital.

I I guess if you could remind us initially before it goes off balance sheet, what type of capital you think you require for this? Can you be using some of the deposits you’re getting on the account side of things? And about the velocity you expect to ramp this, so maybe just remind us on when it came out of beta and how you expect it to ramp over time. And, also, lastly, on the credit rating, you’ve talked about before how there’s a qualitative capital allocation policy as a driver. Have you clarified with them what changes actually would trigger any sort of downgrade or or if there’s any given what you would do with that cash over time, or if they’ve been more explicit on what exactly would trigger any changes to that?

Thank you very much.

Ethan, CFO, Adyen: Yeah. Sure. So let me address your first question on impact of the macro. So what we shared previously when we talked about our building blocks is that the growth of our customers is typically around high single digits, low double digits contributor to our growth, right? And so it is an important part, albeit it’s not the biggest part.

The biggest part is growth in our existing base combined with how we ramp up our new customers. So that part we feel is very well on track, right? That’s exactly what I’ve tried to share around how we look at the opportunity in the year ahead is that the wallet share opportunity looks very, very similar to how we expected it to transpire. We’re really confident in our position to be able to continue to gain market share within our customer base. So I think that’s the important part and what gives us the confidence that we’re really well positioned to grow through any uncertainty is that the biggest part of our growth is driven by what’s in our own control and what’s driven through our execution.

The second question that you have is around capital. That is yes, of course, we can fund it on our own balance sheet for the next while. It will take some time to ramp up. So this is also not a conversation that we’re having actively now about when we would need to move it off balance sheet. We are positioned to be able to provide that capital from our own funds and allow ourselves to scale and do that flexibly, and we’re focused on that.

In terms of velocity to ramp, it’s still to be seen. It will take some time, But it’s absolutely still a key driver of why we’re winning embedded payments business today and why you see that number going from 19 to 30 within a year. On the credit rating side, have we clarified what changes would lead to a downgrade? Of course, we’re in constant dialogue with the rating agencies. And we look for as much clarity as possible.

I think the reality is that on the short term, nothing will likely change in our position around capital allocation, and we’ll continue to focus on driving growth in the business as we know that’s the biggest driver also of shareholder returns.

Maggie O’Donnell, Investor Relations, Adyen: Great. Thanks for your question, Justin. The next question comes from Harshita Rawat at Bernstein. Harshita, please go ahead and unmute yourself and ask your question.

Harshita Rawat, Analyst, Bernstein: Hi, good morning. Thanks for taking my question. Ethan, can you maybe talk about going back to the high single digit customer growth, talk about what you saw in March and April? And also just remind us of around your exposure to overall discretionary spend. We’ve seen some weakness in travel verticals, not necessarily for you guys, but just overall in the market.

I know airlines is primarily gateway kind of volumes for you, but anything else to consider there? And then my second question, I just want to follow-up on The U. S. You ramped up hiring and sales more than a year ago. How is the pipeline looking now?

How are the conversations going? Thank you.

Ethan, CFO, Adyen: Yes. Sure. So what we saw in March and April, your first question, we didn’t see real change. I think the thing that we saw move of anything was that the USD devalued against the euro. And of course, we report in euro.

That won’t have an impact on a constant currency basis. But of course, on a euros reported basis, that’s the only thing that we’ve seen really move. And of course, we there’s some movements in specific verticals. You called out a few. But when we look at it on a total basis, there’s nothing of real significance in those months other than, again, that currency movement that I just referenced.

So we’re not seeing something on our platform today that gives us an indication that anything’s changed. Your second question around The U. S. And how we’re ramping up sales. Yes, it’s going well.

We’re we look at both how individual salespeople are performing compared to previous cohorts, but also how the overall cohorts of customers we’re bringing in, in any given year are developing. And of course, it’s one thing to open that pipeline and to close that pipeline, but then that’s just the land part of our land and expand model. And we also need to expand those customers once they’re live with us. And so we track each of these cohorts quite closely. They’re developing well as we would have expected based on the size of the teams that we’re building.

So I think all of that is on track also in The U. S. It’s also a reason why we’ve been able to grow North America as one of our fastest growing regions over the last years. And so far also in the first quarter, we see the newest cohort also delivering.

Maggie O’Donnell, Investor Relations, Adyen: Great. The next question comes from Hannes Leitner at Jefferies. Hannes, please go ahead and unmute yourself and ask your question.

Hannes Leitner, Analyst, Jefferies: Yes. Thanks for letting me on. Just a couple of questions. The first one is looking at twenty twenty three irrational pricing behavior of some competitors, can you talk about any early indicators you have built in, in your forecasting or contracts to mitigate any stark shift in key merchant trends through competitive pricing behavior? And the second one is on platforms.

That has actually two parts. Can you give an update on Embedded Finance if you have moved up with single business limits? And what is the experience so far in terms of competitive offerings where you have the key benefits? And then just maybe on customer growth in within the platform segment, excluding eBay, can you talk there about that you win there the international legs or you win that the whole business replacing former platform businesses platform payment providers?

: Thank you.

Ethan, CFO, Adyen: Yes, sure. So I think on pricing behavior, you referenced what we discussed in 2023. I think if you look at us now, we’re really well positioned to have these types of conversations with our customers, and we are engaging directly on these types of conversations, right? So it’s not anything new that our customers care about a combination of cost, performance, about managing fraud, right? We’ve been having these conversations at length with our customers for years now, and we feel we’re really well positioned as we sit here today to be able to support them however their priorities develop through the course of this year and the years ahead, right?

If you, again, take a product like Uplift, it’s that balance. It’s saying, hey, you don’t need to sacrifice performance to save costs. We can do that while also managing fraud within your overall payment system. So it’s always about trying to find that balance, and I think that’s landing really well. Another example, again, is U.

S. Debit, right? We provide, again, the balance between cost and performance. I think we’re really well positioned both from a go to market motion perspective, but also from a product perspective to deliver against whatever priorities our customers are asking for. And we’ve been doing so over the last years.

On the second piece, on an update on Embedded Finance. I think a couple of things I can mention. One, we talked about how issuing was growing nicely in our H2 update. That continues to grow nicely also through the course of the beginning of this year. It’s still very small in the scheme of things compared to our acquiring side of our business, but there’s really good signs that we are doing something right on issuing side as well.

And then in embedded finance, if you’re meaning capital, yes, we’re we’ve got customers live. We’re in general availability. We’re, of course, constantly looking at how to improve the product as we build with our customers, and we feel that, that product is also really well positioned for us to scale. At the same time, it’s not a big factor in our 2025 growth as we currently expect it. And then you added one last question on how platforms are growing and whether that’s international, everything.

Yes, it’s both, right? I think platforms are biggest in North America and in Europe. And so when we’re talking to platform customers, we’re talking about their whole business, both how they expand into new markets, whether that’s somewhere in Europe or into The U. S. Or if that’s taking over existing business, both processes that we’ve seen in those 30 platforms we talk about doing over $1,000,000,000 with.

Maggie O’Donnell, Investor Relations, Adyen: Great. Our next question comes from Fred Boulan at Bank of America. Fred, please go ahead and unmute yourself and ask your question.

: Hey, for taking the question. I’m just going to do follow-up previous question around the rest of the year. So we started with 21% ex FX growth in Q1. You will have less headwind from these large clients towards the end of the year, but any other moving parts you can point to that give you confidence in that revenue acceleration that is embedded within your current guidance? And then follow-up on the platform side.

Anything you can share around the differentiation versus existing offers in the market? Very strong growth in the quarter. So it’s good to have the revenue breakdown, but it be good to have a bit more perspective on how you see the perspective and the potential in that business. Thank you very much.

Ethan, CFO, Adyen: Sure. So I think the biggest thing that gives us confidence is when we look at the opportunities within our existing base to grow over the next nine months, right? And I think we’ve been talking about within digital that we’re seeing the biggest opportunity in content and subscription. In unified commerce, it’s not only the fact that we’ve been working in retail over the last years, but it’s also that we’ve been expanding and diversifying to more verticals. We see the fastest growth in verticals like hospitality, like food and beverage.

And then, of course, platforms is getting bigger as a pillar within the overall business each quarter as we go, and we continue to see really, really strong traction also within the platform pillar. So I think the biggest part that gives me the confidence that we’ll continue to grow at a strong rate is that the opportunities that we’ve identified for the course of the year are really there. They’re in active discussion with our customers and, in many cases, are already being worked on. So we’re in a really good position to drive that growth through that expansion with our existing base over the course of the rest of the year. You did mention easing of a headwind towards H2.

I think, of course, that’s the case. We’ve talked about volumes starting to come off in Q3 and in Q4 of last year. But I think more than anything, it’s important, especially, right, you mentioned this year this quarter’s growth. But also, if you look back to last year, every quarter’s growth is not the best indicator of the next quarter’s growth, right? That’s what we’ve seen last year.

We saw 21, 20 six percent, 20 three percent, 20 three percent. What gives us most confidence is looking at, hey, where is the real opportunity within our customer base? How do we expect that to develop over the course of the year? And there, we have real concrete details on an account by account level of how we expect the year to play out. Those are active conversations that we’re having day to day with our customers and why we feel well positioned to deliver on the growth that we’ve been discussing.

Your second question around how we differentiate. I think we differentiate in many ways that may sound familiar within platforms. So one is that we have a global offering, right? We’re not single market. We can offer this in multiple regions around the world.

We have a unified commerce offering. Many of our platforms also have an in person need. That’s where we are also really strong in the offering we can provide. And we can offer not only payments, but an embedded finance suite on our own banking licenses, on our own technology that is quite differentiated in the market. And that positions us really well to say, if you want to go on a growth journey as platform, bringing on payments, bringing on financial products, that we’re a great fit to be your partner in doing that, not only now but also over time.

And that’s been hugely differential for us as we’ve as we’ve been expanding with our platform customers.

Maggie O’Donnell, Investor Relations, Adyen: Thanks, Fred. Our next question comes from Darrin Peller at Wolfe Research. Darrin, please go ahead and unmute yourself and ask your question.

Darrin Peller, Analyst, Wolfe Research: Thanks, Maggie. Thanks, guys. Just maybe touch on your crossborderecom and within that West cross versus maybe even directional. So just any thoughts on there? We’re really thinking about and then maybe as a follow-up, just be your if you could provide some more color on the conversation under 10 FTEs you had during the quarter, Our hiring plans look like this year just as as a reminder, change at all from your buyer assumption investing.

Thanks again, guys.

Ethan, CFO, Adyen: I didn’t pick up every word, but I think I got the first question, which is how do we see cross border e commerce in especially in The U. S. If I got that wrong, please correct me, but I think that’s what I picked up. Yes. So I think you’re right to think about the fact that we are working with many global customers.

But I think partly what we see is that many of our global customers are represented around the world and we work locally with them as well, right? So the majority of our volumes are local volumes that we’re acquiring in the regions in which we’re operating with them. And so there’s nothing specific that I would call out in this part of the business. I think there’s others who probably have better insight to this, but this it hasn’t really moved the needle in any way for us if I look over the last months or weeks. In terms of FTE and our hiring plans, we talked about 110 net joiners in Q1 and that that’s a pretty reasonable expectation of the type of hiring that we’ll do in the quarters throughout the rest of the year.

There’s no real change in how we’re thinking about that. And the main driver of that is that our hiring is not directly connected to any short term movement. It’s connected to a long term opportunity because hiring on the short term is not typically connected to revenues on the short term. And so we’re very confident in not only the opportunity to grow revenues this year, but also to grow revenues in the years ahead. And given that confidence, we want to continue to hire against those plans and and and make sure that we can capitalize on that opportunity.

So nothing has changed in our in our hiring plans.

Maggie O’Donnell, Investor Relations, Adyen: Thanks, Darren. The next question comes from Andrew Bach from Wells Fargo. Andrew, please go ahead and unmute yourself and ask your question.

Andrew Bach, Analyst, Wells Fargo: Hey, guys. Thanks for taking the question. The first one I wanted to ask about was, your AI push and how you guys are going to market both with AI, both externally and internally. There’s been a lot of talk around AgenTek commerce over the last couple of weeks and from your peers as well. And then my second question would be on the platform side.

The point of sale volumes continue to tick up as a percentage of the overall mix. What do you kind of think that end terminal state would be as far as the percentage goes? I’d imagine that recently, it’s been driven by restaurant, but happy to hear what you had to say. Thank you.

Ethan, CFO, Adyen: Yes. So where we’ve highlighted, especially our focus on AI has been around, for instance, our Uplift product. What Uplift ultimately does is, again, it balances performance cost fraud, but it also puts these tools in the hands of our merchants. So they all have access to be able to test different settings on different transactions, see how they perform, what does it do to cost, what does it do to off rates, how does that influence fraud. And we ultimately give that tooling back to them so that they have the power to make these decisions and make them in an informed way.

I think this is really powerful and something that we will continue to focus on to drive the impact that our merchants are looking for. We see many other potential opportunities. There’s a lot of change, of course, happening from a technology perspective, and we’re really excited what that could bring to our customers. At the moment, I wouldn’t talk to more than that. On the platform side, indeed, I mentioned that a big part of our differentiation is that we are offering a unified commerce type experience to platforms, so both allowing them to accept payments in person and online.

And that’s a huge part of why we’re winning in the platform space. It’s also why you see the in person payments part ticking up faster within that space. And in general, payments still are around 80% in person. So I think the fact that we’re at something like 25%, thirty %, I think 27% in total within platforms means there’s still a way to go for us to look like the market within that space. And so it’s really important that we continue to differentiate here for our platform customers.

Maggie O’Donnell, Investor Relations, Adyen: Thanks, Andrew. The next question comes from Sven Mert from Barclays. Sven, please go ahead and unmute yourself and ask your question. Sven, are you able to hear us and unmute yourself? Let’s come back to Sven.

The next

Ethan, CFO, Adyen0: hear me?

Harshita Rawat, Analyst, Bernstein: Oh, yes, we can hear you. Go ahead.

Ethan, CFO, Adyen1: Oh, perfect. Good afternoon. First, maybe a question on the higher U. S. Tariffs.

To some of your customers, you have direct exposure to that. And I think, for example, Timo is planning to increase prices by 100% plus. How do you see this impacting your volumes? Are the price increases sufficient to offset lower activity? Yes, curious how you think about that.

And then secondly, the platform take on has been very strong on a year on year comparison. Can you comment what drove this? Was this only due to the lower eBay volumes? Or do you start to see there perhaps a more meaningful tailwind from your embedded finance offering or anything else to consider? Thank you.

Ethan, CFO, Adyen: Yes, sure. So first, on tariffs in general. I think I would like to stay away from speaking on individual customers because, of course, various customers have a range of impacts from these types of outcomes. I think what’s important to understand here is that we stay very close to our customers. It’s especially an important time to be in discussion with your customers to understand how do they look at their own business and how does their strategy, if at all, shift.

I think the benefit we have is that we’re very global in nature. We’re very well diversified across verticals. So typically, we’re a great partner to be able to help should any strategy shift at all, right? And again, coming back to this point, I find it the most important one that we look at internally is like how do opportunities develop over time? What is the opportunity still in 2025 to grow with our customer base?

And there, again, on a total basis, we have seen almost no shift at all from the last couple of months to where we are today on a total basis. So we feel really well positioned to continue to gain that share through whatever scenarios they are planning for. And we’ll continue to focus again on what we have in our control, on that execution component, on talking to our customers, on being deeply engaged, on helping them through whatever scenarios they’re working through. And I think we’re really well positioned to be able to grow through however this develops. Second piece is on the platform take rate.

I think what you’re seeing here is more of a diversification across this pillar, right? So going from that 19 customers processing over EUR 1,000,000,000 in volume to 30 customers processing over EUR 1,000,000,000, We’re getting more diversified as a pillar. That pillar is growing quickly, and it’s not dependent as much as it was previously on individual customers. I think that’s helping to drive that overall development that you explained in take rate. It’s not specifically because of financial products, just to be clear.

Maggie O’Donnell, Investor Relations, Adyen: Great. Our next question comes from Josh Levin from Autonomous. Josh, please go ahead and unmute yourself and ask your question.

Ethan, CFO, Adyen2: Yeah. Good after two questions. The first is related sort of what was asked previously. Investors are mostly focused on the risks associated with macro uncertainty and tariff wars. Are you seeing specific opportunities presented by tariff wars?

For example, if global trade ends up being rerouted, is that going to create an opportunity for Adyen? And then the second question, you mentioned before that issuing volume, it’s very early stages. It’s kinda small. Adyen has been saying that for years. What is sort of preventing more robust growth in issuing?

Is it lack of demand, or is it Adient sort of really sort of restricting supply? Thank you.

Ethan, CFO, Adyen: Yeah. Sure. So there certainly are opportunities. Again, to my earlier point, because we’re such a global business, depending on how our customers look at their strategies for the rest of the year, we have opportunities across many markets, right? Because of our presence in Latin America, because of our presence in APAC, in Europe, in EMEA, in North America, we’re well diversified and can support them depending on how their strategies shift, if they do.

Right? And that’s why it’s especially important that we are engaged day to day really understanding the challenges and opportunities that our customers are looking at because we’re really well positioned to support them however those develop. And so it’s certainly something that we’re very much focused on, especially because it’s tied back again to what’s in our control, to what we can execute against. As for issuing volume, I think the reality is that in building anything new, it just takes time in our space. We’re talking about enterprise issuing, right, really delivering premium functionality that takes time to build.

And I think we’re seeing really good traction. We talked about the growth that we’re seeing in the second half of last year, that continued acceleration in our issuing volume growth, we’re also seeing through the course of the beginning of this year. At the same time, it’s competing with huge acquiring business. And therefore, the total financial impact to date, it’s relatively limited. But there is real progress happening on the issuing side.

And I think we’re really excited about the opportunity that will come with that.

Maggie O’Donnell, Investor Relations, Adyen: Great. Our next question comes from Pavan Daswani from Citi. Pavan, please go ahead and unmute yourself and ask your question.

Ethan, CFO, Adyen3: Great. Thanks. Afternoon, and thanks for taking my questions. I’ve got a couple of follow ups to earlier questions. Firstly, I appreciate the flag on market growth component of growth.

On wallet share gains and new wins, you’ve previously talked about having a six to twelve month visibility. Could you maybe touch on the stickiness of these plans that you have in place for existing customers, maybe referring to previous periods of slower e commerce growth like in 2022? And then secondly, you’ve done 110 hires in Q1, which you mentioned as a cadence we should expect on a quarterly basis for the rest of the year. Appreciate the focus today is on top line, but is this broadly in line with your plans for margin improvement in 2025 that you’ve talked about?

Ethan, CFO, Adyen: Yes. So I would say, in general, when we look out to our plans of, let’s say, six to twelve months, they generally, for the large majority of them, are executed as we would expect. That also happened through different macroeconomic cycles. You referenced 2022. We have good insight on the growth opportunities of our customer base, and we’re working day to day with them to understand their needs.

And these typically play out on that type of time frame in a way that, yes, we would expect. So I think it is pretty safe to assume that, that will continue to develop as we’re currently foreseeing it. Of course, we need to stay close to our customers, and we need to make sure that we understand how their businesses are developing and what their priorities are. But I think we’re really well positioned to do that, again, given our enterprise angle, the fact that we have a strong account management team day to day interacting with these customers. And I feel, compared to a couple of years ago, that we’ve really landed the type of message around TCO, around how to support and balance cost and performance in a way that positions us really well.

As for hiring, this is the hiring plan indeed that is in line with the margin improvements that we’ve been talking about. So yes, this is still our expectation.

Maggie O’Donnell, Investor Relations, Adyen: Great. Our next question comes from Adam Frisch from Evercore. Adam, please go ahead and unmute yourself and ask your question.

Ethan, CFO, Adyen0: Okay. Thanks very much. Your runway with existing sellers is far from making that great. And at some point, it will in the noise of eBay and another customer, people are asking about the future growth plan. So can you provide some context around your investment, salespeople, new accounts brought on, how much growth that could bring it to basically anything to growth opportunities that are not currently on the book that you had on?

Maggie O’Donnell, Investor Relations, Adyen: Do you mind repeating that? I think we were breaking up a little bit. It would be great if you could just repeat it one more time.

Ethan, CFO, Adyen0: Yeah. It’s about new growth that’s on your book. So if you could talk about your investment in new sales, new accounts brought on, how much growth that could bring? Basically, any anything you feel could speak to the growth opportunities that are not currently on your book that address this issue?

Ethan, CFO, Adyen: Yeah. Sure. That’s a that’s a good question. We talk about existing customers, but it’s also important to keep in mind that every year, there becomes more existing customers, right? Because we’re continuously adding new cohorts.

And while those cohorts are new for some time, they, at some point, move into the existing bucket. And if we look back at the last couple of years around the cohorts that we’ve been adding to the platform, who we would now call existing customers, those have developed really nicely, in line with the hiring that we’ve been doing over the past years, but also in the way that they’re ramping up on our platform, right? Because our model is not just land, but it’s that land and expand model. They’re growing in a similar way to how we would have expected previously. At the same time, we also look at how individual sales team members are able to land deals, and that’s also progressing as we would expect.

They become typically more efficient in closing deals as time goes on, as they’re longer at Adyen. That trend we’re seeing through the more recent sales hires, but we’re also seeing that in terms of win rates. So I think the question of is there still runway for us to add new customers who will fuel that existing customer growth in the years ahead, I think absolutely there is. We’re not restricted to specific verticals or specific regions. Even in our most mature verticals or regions, we see many opportunities to add new customers.

And so absolutely, we think that this growth runway will go for a long time.

Maggie O’Donnell, Investor Relations, Adyen: Thanks, Adam. Our final question comes from Alex Foray from BNP Paribas. Alex, please go ahead.

Ethan, CFO, Adyen4: Hi. Good afternoon. Thanks for squeezing me in. You’ve had a few quarters of about 20% volume growth in digital, which is quite impressive for a relatively mature segment for Alien. I think in the most recent quarter, you also show that net revenues in digital were growing about 13%.

I understand there’s a cash app impact in that, but it feels like there’s a five points differential. Is this the right way of thinking of the algo in digital, so you can continue to sustain very strong volume growth, we should expect continued take rate erosion?

Ethan, CFO, Adyen: Yes. I think the way to think about take rates in general is to tie it to size. Of course, we incentivize customers to grow with us given our pricing model. And so I think this type of pricing impact, it’s pretty comparable to the scale at which we shared within our building blocks at last Investor Day. I don’t think it’s unusual, but it also just is a development of what type of volumes from which size customers are you bringing in, in any given period.

And I think, indeed, to your point, we’re quite pleased to see the developments in digital that even our most mature pillar, our most sizable pillar is the one that’s still gaining market share that we’re doing that across verticals and across regions. I think we’re really well positioned still within our existing base as there’s still a long runway for us to grow within those customers, but we’re also able to scale on the new business side. And so I think this is a trend that’s well in line with our expectations. But again, on a shorter term basis, the movements in volumes could be less indicative given that it’s really about the scale of customers that we’re building with more than anything.

Maggie O’Donnell, Investor Relations, Adyen: Great. Well, so we’re out of time. So thank you very much for joining us today. We appreciate you taking the time to listen today. For any further questions, don’t hesitate to reach out to the IR team.

Have a great day.

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