Wealthfront Q2 revenue slightly beats estimates on platform asset growth
Wealthfront Q2 revenue slightly beats estimates on platform asset growth
Overview
U.S. fintech platform's fiscal Q2 revenue rose 1% yr/yr, slightly beating analyst expectations
Adjusted EBITDA for fiscal Q2 fell 15% yr/yr and slightly missed analyst estimates
Company repurchased 3.3 mln shares during the quarter
Outlook
Company did not provide specific financial guidance for future quarters or the full year
Result Drivers
ASSET MIX SHIFT - Revenue growth lagged platform asset growth due to stronger gains in lower-fee investment advisory assets and a decline in higher-fee cash management assets
EXPENSE INCREASES - Higher GAAP expenses, mainly from stock-based compensation after IPO and increased product development spending, reduced net income
PRODUCT DEVELOPMENT - Ongoing investment in new offerings such as Home Lending and Custodial Accounts contributed to higher expenses
Company press release: ID:nGNX4JFx2
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q2 Revenue | Slight Beat* | $91.87 mln | $91.50 mln (7 Analysts) |
Q2 EPS |
| $0.10 |
|
Q2 Net Income |
| $17.56 mln |
|
Q2 Adjusted EBITDA | Slight Miss* | $38.07 mln | $38.20 mln (7 Analysts) |
Q2 Adjusted EBITDA Margin |
| 41% |
|
*Applies to a deviation of less than 1%; not applicable for per-share numbers.
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "strong buy" or "buy", 3 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the diversified investment services peer group is "buy"
Wall Street's median 12-month price target for Wealthfront Corporation is $11.50, about 19.4% above its September 8 closing price of $9.63
Reuters Recommended Reads
Sept 9 - Chime shares jump as Stride deal puts fintech on path to bank charter
Sept 8 - Chime to buy nationally chartered Stride Bank for $590 million, shares jump
Sept 9 - US Bancorp executes first live transaction using dollar-backed USBDC stablecoin
For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.
(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)
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