Release Date: February 25, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: What were the biggest drivers of Sezzle's 100% year-over-year revenue growth in Q4 2024? A: Charlie, CEO and Executive Chairman, explained that the partnership with Webbank was a significant driver. This partnership allowed Sezzle to unify its fee structure across the United States, leading to increased revenue and trust margin. Additionally, the launch of the OnDemand product contributed to growth, with mods (monthly on-demand and subscriber users) increasing to 707,000 over the quarter.
Q: How did the holiday season impact Sezzle's revenue growth? A: Charlie noted that while the holiday season contributed to growth, the year-over-year comparison already accounts for seasonality. The introduction of OnDemand, which allows shopping at more places, helped maintain momentum throughout the quarter, shifting the peak shopping period from November to December.
Q: Can you provide insights into the performance of Sezzle's Anywhere and Premium products in Q4 2024? A: Charlie stated that while subscriber numbers remained stable, the focus was on introducing OnDemand to new consumers due to its lower barrier to entry. The strategy is to lead with OnDemand and eventually transition frequent users to subscription products, similar to how Uber introduces its subscription service.
Q: What is Sezzle's approach to enhancing consumer engagement through its product marketplace? A: Charlie emphasized that Sezzle aims to make its app the go-to platform for customers by continuously improving features. The app's enhancements have led to a 39% month-over-month growth in orders and a 70% increase in session activity. The focus is on drawing more users and retaining existing ones through ongoing improvements.
Q: How is Sezzle's funnel shaping up for signing more mid-market and enterprise merchants? A: Charlie mentioned that the funnel remains strong and is improving, especially with the introduction of OnDemand. This product allows Sezzle to pass on some fees to consumers, making it more appealing to cost-conscious enterprise merchants. The company expects continued growth in enterprise merchant signings.
Q: Is there potential for monetization in Sezzle's couponing feature? A: Charlie acknowledged that there are monetization opportunities in couponing and other shopping activities. However, the focus is on balancing customer attraction and retention with profitability. Sezzle plans to experiment with monetization strategies while leveraging its profitable buy now, pay later products.
Q: What are Sezzle's plans for capital allocation given its strong cash generation? A: Charlie highlighted that being a profitable company provides various options, including reducing the need for a line of credit, share buybacks, dividends, and M&A opportunities. The company plans to continue executing its strategy and evaluate options as they arise.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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