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Why is Dlocal Limited (DLO) Stock down?
DLocal Limited stock (DLO) declined by 26.36% following the company's earnings report released after the market close on Tuesday.
- Earnings Miss: The company reported GAAP EPS of 6 cents, falling short of analyst estimates which had projected EPS of 12 cents.
- Sales Performance: DLocal's sales for the period amounted to $184 million, failing to meet analyst expectations of $189.98 million. Although revenue saw a notable increase of 34% compared to the previous year, it declined by 2% quarter-over-quarter.
- Payment Volume and EBITDA: Despite the revenue shortfall, DLocal reported a substantial growth in total payment volume, reaching $5.3 billion, marking a 49% increase year-over-year. However, adjusted EBITDA saw a decline of 19% year-over-year, amounting to $37 million.
- Outlook and Analyst Responses: DLocal expressed its commitment to achieving its 2024 guidance but acknowledged a heightened probability of landing towards the lower end of the provided ranges.
dLocal Limited stock (DLO) decreased 17.49% following the announcement of mixed 2024 results and light guidance. The Uruguay-based fintech company reported weaker-than-expected quarterly results, leading to the decline in its stock price.
- Quarterly Results: In the fourth quarter of 2023, dLocal's revenue grew by 59% year over year to $188 million, with adjusted (non-IFRS) net income of $40.6 million, or $0.14 per share. Analysts had expected slightly higher adjusted net income of $0.15 per share but lower revenue of $173.2 million. dLocal's total payment volume (TPV) in the fourth quarter grew by 55% year over year to $5.1 billion, and the company's net revenue retention rate was strong at 149%.
- Future Outlook: For 2024, dLocal expects TPV to be between $25 billion and $27 billion, representing growth of 40% to 50% from 2023. The company also forecasts adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) in the range of $220 million to $260 million, up 10% to 30% from the previous year.
Shares of DLocal Limited (DLO) dropped by 7.55% from $18.80 to $17.38 in the trading on Wednesday, November 22, 2023. The reason why DLO is down today is due to weak quarterly results and a change in management board.
- Q3 results: DLocal reported a record Total Payment Volume (TPV) of $4.6 billion for the third quarter, marking a 69% year-over-year increase. Despite this growth, the company's revenues of $163.9 million were slightly below market projections, and the gross profit margin decreased to 45%. Furthermore, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for the quarter reached $55.6 million, but it was not enough to prevent the stock's decline.
- CFO's Departure and Financial Position: In addition to the disappointing financial results, DLocal announced that its Chief Financial Officer (CFO), Diego Cabrera Canay, had chosen to step down from his role to pursue other career opportunities. This change in leadership may have contributed to investor concerns and the stock's decline.
DLO dropped by around 26.27% following the release of its Q4 earnings report, which showed diluted earnings per share of $0.06 and total revenue of $118 million. Both figures were below analysts' estimates for the quarter, resulting in a 15% decline in share prices.
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