Sezzle Marks 3rd Straight Profitable Quarter as BNPL Volumes Grow

Sezzle saw its volumes increase in its most recent quarter, while seeing continued profitability.

The buy now, pay later (BNPL) firm announced earnings Monday (May 15) that showed its monthly revenue increasing 25% year over year.

The company said its income improved year over year due to the continued adoption of its Sezzle Premium offering and revenue initiatives from its last fiscal year.

“We continue to see revenue growth while improving our unit economics and cost efficiencies,” Sezzle CEO Charlie Youakim said in a news release. “We also expect to layer on a number of revenue-driving initiatives before the end of the third quarter, adding to the improvements we began in 2022.”

Weekly volumes through Sezzle’s marketplace averaged 30% of total volume per week during this quarter, compared to 13% during the same quarter in 2022.

As PYMNTS wrote last week in a look at the overall health of the BNPL space, volumes are among “the most telling indicators of BNPL’s embrace.”

According to that report, the term volume is “defined as gross sales volumes or merchant sales volumes. Across the board, those volumes are up, markedly so.”

Sezzle said Monday that its quarterly profits were driven by revenue and cost initiatives, but chiefly by a reduction in the provision for credit losses.

Looking ahead, the company said it is focused on initiatives to drive top-line growth, including product innovation such as a “pay anywhere” card, partnerships with entities such as banks, and feature monetization like affiliate payment models.

PYMNTS’s Karen Webster spoke last week with Youakim — and Dave founder and CEO Jason Wilk — both of whom said neobanks’ move toward profitability depends on finding ways to empower clients.

Youakim said there’s some similarity between Sezzle’s customer base and Dave’s, as customers using BNPL appreciate the chance to make installment payments amid continued inflation and paycheck-to-paycheck pressures.

For both companies, that report said, these customers are not the ones with $250,000 and above that are concerned with FDIC insurance and moving their deposits to big banks to ensure their wealth is safe. These are people who want to do their banking with providers that cut out fees and work with them to better their financial health.

“One of the sayings that our CFO has is that our customer is always in a recession,” Youakim said. “We’re trying our best to help that customer build up their credit score and get onto the next stage of their financial lives.”