CE 100 Loses 2.5% as Western Union Leads Payment Names Lower

The CE 100 Index lost 2.5%, as payment-related names led to the downside.

The Pay and be Paid segment was the worst performing sector, sliding 4.9% through the week.

And within that pillar, Western Union gave up 14.1%.

The company posted earnings this week that showed growth of 3% in its branded digital revenue year over year for the quarter ending Sept. 30.

Western Union’s CEO Devin McGranahan noted that the company achieved “positive global branded digital revenue growth a full quarter ahead of our expectations.” Branded digital revenue was up 10% year to date and comprises 21% of its consumer-to-consumer segment revenues for the same period. Western Union defines branded digital revenue as “transactions conducted and funded through websites and mobile [apps].”

For the third quarter, the digital portion of the consumer-to-consumer (C2C) transactions was up 12% YoY. The digital segment was 28% of total C2C transactions.

McGranahan announced that global retail transactions returned to flat YoY growth in Q3 2023. This marks a turning point, we noted during earnings coverage, for Western Union’s retail business, which had experienced declines in previous years.

Block Slips in Wake of New AI Features

Also, within the payments-focused pillar, Block (the corporate name for Square) lost 9.1%. As reported here, Square earlier in the month announced the launch of 10 new generative AI features that aim to assist businesses.

These tools are integrated into Square’s business software and provide sellers with the ability to automate operations and streamline workflows. Square has also introduced AI-generated content creation tools, the company said. Sellers can now benefit from personalized email copy generated by Square Marketing.

Only One Pillar Gains Ground

The Be Well pillar sank 3.9%, led by Teladoc Health’s shares, which declined 15.6%. The company reported earnings that gave details. For the third quarter of 2023, Teladoc Health’s revenue increased 8% to $660.2 million from $611.4 million in the third quarter of 2022. Access fees revenue grew 8% to $582.1 million and other revenue grew 10% to $78.2 million. U.S. revenue grew 7% to $569.3 million and International revenue grew 17% to $90.9 million.

The Live Pillar was the lone pillar to notch overall gains in the week. Shares of Stride Inc. surged 22%. In its own fiscal first-quarter earnings report, the firm said that total revenues were up 12.9% to $480.2 million, driven by General Education and Career Learning enrollment strength. The company said that total enrollments, at 187.9 million, were up 8.1%, and remain 50% higher than pre-pandemic levels. Forward guidance for 2024 revenue anticipates 9% gains at the midpoint, according to company materials.

Elsewhere, WeWork shares gained 19.5%. Reports from sites such as Bloomberg noted that the company is in the midst of talks with major investors such as SoftBank and bondholders, including King Street Capital Management, over control of the company and how WeWork might be restructured. Restructuring plans, sources told Bloomberg, might be completed in the coming weeks and plans may include a bankruptcy filing. The firm is nearing the end of a grace period tied to its missing $95 million worth of interest payments to bondholders a few weeks ago.