CE100 Tops Broader Market as BNPL, Payments Offset Snap’s 39% Decline

The PYMNTS ConnectedEconomy™ 100 Index (CE100™) managed to outpace the broader markets this past week, buoyed by Sezzle and other payment-focused names.

It’s no surprise that earnings season helped determine how the stocks moved. To that end, the group gained 5% on the week, outpacing the 2.4% seen in the broader Standard and Poor’s 500 Stock Index.

CE100 Relative Performance

Source: PYMNTS

The best performing pillar was the Pay and Be Paid pillar, with a boost of 10.3%. Sezzle was the standout here, having surged 20%, rebounding from the previous week’s double digit slide.

As reported in this space during the week, Sezzle is suing GameStop over allegations that the video game retailer broke a contract by dropping Sezzle’s payment service.

Read more: BNPL Firm Sezzle Sues GameStop for Dropping Payment Service

The complaint, filed in county court in St. Paul, Minnesota, claimed that the two sides entered into a two-year contract in November 2020. The FinTech offered its digital payment services for GameStop customers, and Sezzle took 2.5% and 30 cents for every transaction.

Sezzle said it put more than $2 million into promotional material around the partnership, according to the complaint.

Meanwhile, American Express was 7% higher through the past five sessions. In earnings coverage via PYMNTS, Amex’s report reflected a continued surge in the use of credit to conduct everyday commerce, and younger consumers in particular are proving to be resilient as they shop online and in-store.

See also: American Express: Millennial, Gen Z Card Spend Up Nearly 50%

American Express said billed business — the dollar amount of all charges on its cards — was up 30%. Additionally, spending from Gen Z and millennials was up 48% year on year, outpacing other generations.

CEO Steve Squeri said on a conference call with analysts that these younger consumers “are a large part of our existing customer base and our fastest growing age cohort, making up 60% of all new consumer card members we’re acquiring and around 75% of new U.S. consumer Platinum and Gold Card members.”

Furthermore, Ocado was up 5.2%, and the company has been mulling a strategic shift of sorts, with a slowdown of expansion plans. As reported this week, customers are reducing their use of delivery for online grocery shopping orders.

Related: Ocado Reels in Delivery Expansion as UK Shoppers Head to Stores

Ocado CEO Tim Steiner said the recent opening of its new facilities in Bicester and Luton in England gives the company “a lot of capacity to grow into.”

While Ocado’s expansion timetable is being slowed, plans for fulfillment centers already on tap are moving forward — and there are signs that the shift to online ordering is inexorable. PYMNTS report with Riskified last month showed that close to 60% more shoppers went for groceries online rather than in person in the past 12 months in the U.S.

These, and other gains, were enough to offset the torrid slide seen with Snap as that name plummeted 39%. In Snap’s earnings results announced last Thursday (July 21), the social media company recorded its weakest-ever quarterly sales growth, where sales were up 13% year on year to $1.1 billion.

That’s a marked slowdown from the triple-digit percentage point growth rates seen in prior periods. The company has decided to cut spending, and the digital advertising market is seeing competition.

But Snap has also said that “platform policy changes have upended more than a decade of advertising industry standards, and macroeconomic challenges have disrupted many of the industry segments that have been most critical to the growing demand for our advertising solutions. We are also seeing increasing competition for advertising dollars that are now growing more slowly.”

Call it the Apple problem.

Read more: Snap Earnings Spotlight Platforms’ Revenue Woes After Apple Privacy Switch

Last year, Apple introduced its App Tracking Transparency system that lets users have the choice about whether third-party apps can track them. Those changes to iOS have helped disrupt at least some of Snap’s advertising activity.

Snap, for its part, has been trying to monetize its model in different ways. Management pointed to the company’s response business, including first- and third-party measurement solutions as focus areas — but it will all take time. The dismal earnings showing has also impacted other platform names, as Pinterest, for example, slipped nearly 14%.