Cardlytics Stock Gets Decimated on Weak Q2 Sales

Shares of Cardlytics (NASDAQ: CDLX) plunged in the present day after reporting second quarter earnings on Tuesday night.

The corporate, which operates rewards packages for monetary establishments in addition to a digital promoting platform, missed income expectations and provided a lackluster outlook for the third quarter.

As of 12:30 p.m. EDT, Cardlytics inventory was down by 26%.

The pandemic continues to harm advertising budgets

Income within the second quarter elevated 109% to $58.9 million, lacking the consensus estimate of $62.8 million. Billings have been $85.3 million, and adjusted contribution was $29.6 million. The platform had 167.6 million month-to-month lively customers (MAUs), and common income per person (ARPU) elevated by 89% to $0.34.

Cardlytics had acquired Bridg, a buyer information platform, through the quarter for roughly $350 million in money in a transfer designed to bolster the promoting platform.

Bridg’s annualized recurring income (ARR) within the second quarter was $12.5 million. That acquisition got here within the wake of the acquisition of Dosh within the first quarter. Cardlytics will now give attention to integrating each acquisitions.

CEO Lynne Laube conceded that the outcomes missed inside expectations, pointing to a slower restoration in crucial finish markets that Cardlytics serves.

“Whereas we grew Cardlytics platform billings 111% and adjusted contribution 123% year-over-year, we fell under our steerage,” Laube commented in a launch. “This was pushed by us forecasting a quicker restoration than was realized attributable to labor scarcity and provide chain challenges in retail, restaurant and journey.”

On the convention name with analysts, Laube stated administration was “disenchanted within the miss,” however reassured buyers that the “enterprise is performing properly” general.

Along with the labor shortages and provide chain points, the chief government additionally elaborated that the broad enhance in buyer demand translated right into a diminished want for promoting at a number of massive clients. 

“For instance, a number of of our key shopper eating places paused their advertising as a result of they couldn’t buy sufficient crucial elements,” Laube commented. “A males’s clothes shopper halted all of their advertising spend once they realized their provide chain couldn’t ship the stock they wanted to take care of buyer choice.”

After all the things was stated and finished, Cardlytics reported an adjusted internet lack of $12.8 million, or $0.39 per share. Wall Road analysts have been modeling for that precise $0.39 per share in adjusted losses.

Guiding income under expectations

Continued macroeconomic financial uncertainty associated to the COVID-19 pandemic is creating volatility in advertising budgets, so Cardlytics is making an attempt to take issues one quarter at a time. The corporate is offering steerage for the third quarter however not for the complete yr attributable to restricted visibility. 

Outlook for the third quarter requires $85 million to $95 million billings, with income forecast at $57 million to $66 million. Adjusted contribution is predicted to be $27 million to $32 million. Analysts are in search of $71 million in gross sales subsequent quarter.

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