Sezzle Reports First Quarter 2025 Results

May 7, 2025

Minneapolis, MN, May 07, 2025 (GLOBE NEWSWIRE) -- Sezzle Inc. (NASDAQ:SEZL) (Sezzle or Company) // Purpose-driven digital payment platform, Sezzle, is pleased to update the market on key financial metrics for the quarter ended March 31, 2025.

“Our investments in innovation and consumer experience drove new highs in engagement and performance in the first quarter,” noted Charlie Youakim, Sezzle Chairman and CEO. “Stronger consumer activity and better-than-expected repayment trends propelled quarterly earnings above our expectations. These positive developments give us the confidence to raise our 2025 Net Income guidance by nearly 50% to $120 million.”

First Quarter 2025 Highlights

• Gross Merchandise Volume (GMV) reached $808.7 million in 1Q25, rising 64.1% YoY, fueled by increased Subscriber and On-Demand user engagement. Overall consumer purchase frequency rose to 6.1 times, up from 4.5 times in the prior year’s comparable period.

• Total Revenue grew 123.3% YoY to a new quarterly high of $104.9 million, benefiting from higher engagement and the sustained lift from the WebBank partnership. As a percentage of GMV, Total Revenue rose to 13.0%, surpassing the prior high of 11.5% in 4Q24.

• As of March 31, 2025, Sezzle reported 658,000 Monthly On-Demand & Subscribers (MODS) (rounded to the nearest thousand). The sequential decline from 707,000 in 4Q24 is consistent with seasonal trends following the holiday shopping period.

• Total Operating Expenses increased 66.0% YoY to $55.0 million, but improved as a share of Total Revenue, dropping 18.2 points to 52.4%, reflecting continued operating leverage.

• Transaction Related Costs as a percentage of GMV dropped from 4.3% to 3.8% YoY, driven by better-than-expected credit performance, effective payment processing strategies, and reduced interest costs from improved facility terms compared to the prior year’s facility. In absolute terms, Transaction Related Costs rose 47.7% YoY to $31.0 million.

• Non-Transaction Related Operating Expenses increased 65.9% YoY to $26.9 million, but improved as a share of Total Revenue, declining 8.9 points to a new Company low of 25.6%. This continued decline is evidence of the Company’s ongoing focus on cost management and leveraging its infrastructure.

• Operating Income jumped 260.6% YoY to $49.9 million in 1Q25, outperforming the previous high of $30.9 million set in 4Q24. Operating Margin expanded by 18.2 points YoY to reach 47.6%.

• Supported by strong growth in Total Revenue and improved efficiency in Transaction Related Costs, Total Revenue Less Transaction Related Costs² increased 184.5% to set a new quarterly high of $73.9 million. As a share of GMV and Total Revenue, the metric rose to 9.1% and 70.4%, respectively – representing gains of 3.8 and 15.1 points compared to 1Q24.

• In 1Q25, Net Income more than quadrupled YoY to $36.2 million — or 34.5% of Total Revenue —equating to Earnings per Diluted Share of $1.00, up from $0.22 in the prior comparable period.

• Adjusted EBITDA² came in at $51.4 million, representing a 243.7% YoY growth and 49.0% of Total Revenue – an 17.1-point expansion from 1Q24.

• Continued growth in profitability fueled strong cash generation, with Cash Flow from Operations of $58.8 million in 1Q25, up from $38.6M in 1Q24.

Balance Sheet and Liquidity

• As of March 31, 2025, Sezzle had $120.9 million of cash and cash equivalents, $32.0 million of which was restricted.

• The Company had an outstanding principal balance of $70.8 million on its $150.0 million credit facility as of quarter end.

Updated FY2025 Guidance

• The Company is increasing its FY2025 guidance to reflect the latest business trends:

• Net Income and Adjusted Net Income: Raising both to $120.0 million from $80.4 million provided with 4Q24 earnings.

• Net Income and Adjusted Net Income per Diluted Share: Increasing both to $3.25 from $2.21 provided with 4Q24 earnings.

• Total Revenue Growth: New guidance of 60-65% versus 25-30% provided with 4Q24 earnings.

• Total Revenue Less Transaction Related Costs⁴ as a percentage of Total Revenue: New guidance of 60%-65% compared to 55%-60% provided with 4Q24 earnings.

• The Company anticipates an effective tax rate of 25% for FY2025.

Initiatives Update

• Sezzle launched enhanced shopping and financials features designed to deepen engagement and streamline the end-to-end shopping experience.

• Pay-in-5 (beta): Offers greater flexibility at the checkout with an additional payment option.

• Enhanced shopping tools: Price Comparison, Wishlist, and Auto-applied Coupons (beta) empower consumers to personalize their shopping journey, discover deals, and maximize savings.

• Sezzle Balance: Streamlines repayment by enabling consumers to pay off purchases easily through their pre-loaded balance.

• Money IQ: Rewards consumers for building financial knowledge through interactive learning modules.

• Sezzle expanded its merchant network with Scheels, a premium sporting goods retailer with 30+ U.S. locations, and WHOP, a fast-growing digital marketplace for creators and online communities.

Upcoming Events

• The Company will host its 2025 Annual Meeting of Stockholders on June 10, 2025, at 5:00 p.m. (U.S. Eastern Time) via live webcast conducted exclusively online. Please refer to the definitive proxy statement filed on April 30, 2025, for the webcast link and further information regarding the event.

• Sezzle Management will participate in the upcoming investor conferences:

• May 12, 2025: The 20^th Annual Needham Technology, Media, & Consumer 1×1 Conference.

• May 13, 2025: The 53^rd Annual J.P. Morgan Global Technology, Media and Communications Conference.

• May 21-22, 2025: B. Riley Securities 25th Annual Investor Conference.

• June 25, 2025: 2025 Northland Growth Conference.

Quarterly Conference Call and Presentation

The Company will host its first quarter earnings conference call on May 7, 2025, at 5:00pm ET. To register for the call, please navigate to: https://dpregister.com/sreg/10198853/feef6e099b All participants can access the webcast using the following link: https://event.choruscall.com/mediaframe/webcast.html?webcastid=UmcWRTYP Upon registration, participants will receive the dial-in number. Those without internet access or unable to pre-register may dial in by calling: 1-866-777-2509 (US/CA toll free) or 1-412-317-5413 (international toll). A replay will be available until May 14, 2025. To access the replay dial 1-877-344-7529 (US toll free) or 1-412-317-0088 (International toll). Replay access code: 8156740.

In conjunction with the earnings call, the Company will release its presentation on the Sezzle Investor Relations website before the call. Please navigate to the Sezzle Investor Relations website for the presentation that management will review on the call. Investors should be aware that generally accepted accounting principles prescribe when a company may reserve for particular risks, including litigation exposures. Accordingly, results for a given reporting period could be significantly affected if and when we establish reserves for one or more contingencies. Also, our regular reserve reviews may result in adjustments of varying magnitude as additional information regarding claims activity becomes known. Reported results, therefore, may be volatile in certain accounting periods.

Contact Information

About Sezzle Inc.

Sezzle is a forward-thinking fintech company committed to financially empowering the next generation. Through its purpose-driven payment platform, Sezzle enhances consumers' purchasing power by offering access to point-of-sale financing options and digital payment services—connecting millions of customers with its global network of merchants. Centered on transparency, inclusivity, and ease of use, Sezzle empowers consumers to manage spending responsibly, take charge of their finances, and achieve lasting financial independence.

For more information visit sezzle.com.