Fantastic next gen payment processor. I prefer to add around their earning days where price swung violently though. Thank you again and enjoy your write up!
Still like it, will likely add. Most disappointing thing for me from earnings and guidance was the step-up in hiring for 2026 which is going to cap margin expansion (expected to be flat with 2025). Part of my thesis, but not the only part, is that Adyen has lots of untapped margin potential given the significant hiring they have done in recent years, which drove margins down from 63% to 53%. Still think that’s the case but significant margin expansion is unlikely to materialize over near-term given focus on investments to drive long-term growth.
Hiring can work both ways, if done sensibly, it can unlock growth that lack of capacity was impeding. For eg they do and can further provide features where AI can detect fraudulent transaction.
The data that they generate is a treasure trove, and AI can be huge tailwind.
I think their one of their challenges is that online sales is taking away revenue from them, and that is a trend which will be secular.
This text is amazing, congrats! You have calculated the EV by subtracting the merchant's float from cash and equivalents, and projected the EBITDA very accurately (in a worst-case scenario) with a 20% revenue guidance. I’ve arrived at the same EV/EBIT and EV/EBITDA multiples, and honestly, I hadn't found anyone who had done it correctly until now.
Strong case for Adyen's single-platform architecture vs the Frankensteined legacy players. The margin recovery trajectory from 47% to 60% feels achieveable given they avoided layoffs entirely while peers were cutting. What's underrated is the embedded finance optionality because it creates switching costs beyondpayment processing itself. The agentic commerce risk is real but early enough that platform players with data advantages probably capture more value than they lose.
Fantastic next gen payment processor. I prefer to add around their earning days where price swung violently though. Thank you again and enjoy your write up!
Hi, Any thoughts on Adyen after earnings.
Still like it, will likely add. Most disappointing thing for me from earnings and guidance was the step-up in hiring for 2026 which is going to cap margin expansion (expected to be flat with 2025). Part of my thesis, but not the only part, is that Adyen has lots of untapped margin potential given the significant hiring they have done in recent years, which drove margins down from 63% to 53%. Still think that’s the case but significant margin expansion is unlikely to materialize over near-term given focus on investments to drive long-term growth.
But then again, it depends how wisely do they hire, and how effective they are.
Same, am holding a position.
Hiring can work both ways, if done sensibly, it can unlock growth that lack of capacity was impeding. For eg they do and can further provide features where AI can detect fraudulent transaction.
The data that they generate is a treasure trove, and AI can be huge tailwind.
I think their one of their challenges is that online sales is taking away revenue from them, and that is a trend which will be secular.
This text is amazing, congrats! You have calculated the EV by subtracting the merchant's float from cash and equivalents, and projected the EBITDA very accurately (in a worst-case scenario) with a 20% revenue guidance. I’ve arrived at the same EV/EBIT and EV/EBITDA multiples, and honestly, I hadn't found anyone who had done it correctly until now.
Thank you, I appreciate the positive feedback!
Strong case for Adyen's single-platform architecture vs the Frankensteined legacy players. The margin recovery trajectory from 47% to 60% feels achieveable given they avoided layoffs entirely while peers were cutting. What's underrated is the embedded finance optionality because it creates switching costs beyondpayment processing itself. The agentic commerce risk is real but early enough that platform players with data advantages probably capture more value than they lose.