On August 7, Sezzle Inc fell 30.74% in regular trading, trading at $121.27/share, with turnover of $105 million. The sharp decline was triggered by the company's Q2 earnings report, which despite beating consensus estimates, revealed a significant sequential deterioration in profitability.
Sezzle reported Q2 revenue of $149.7 million, exceeding the consensus estimate of $135.1 million, while adjusted EPS of $1.17 surpassed the $1.03 estimate by 13.6%. The company also raised its full-year adjusted EPS guidance from $5.10 to $5.25. However, Q2 adjusted EPS declined over 20% sequentially from Q1's $1.47, signaling a notable contraction in earnings momentum.
Following Q1 results, the stock had rallied approximately 20%, substantially elevating market expectations. Despite the headline beat, the sequential slowdown in profitability raised investor concerns about sustainable growth trajectory. Analyst opinions remained divided, with Needham raising its price target while KBW cut its rating, further amplifying selling pressure and triggering broad-based profit-taking.
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