FinTech IPO Index Gains 4.4% as Toast and dLocal Get a Boost on Earnings

Moving into mid-May, the FinTech IPO Index’s 4.4% increase was powered by a string of earnings reports, with digital payments growth seen across Latin America and swelling transaction volumes for buy now, pay later providers and B2B platforms.

As PYMNTS reported, Toast sees promise in its artificial intelligence (AI)-driven efforts improve restaurants’ operating efficiencies. CEO and co-founder Aman Narang said a restaurant participating in the pilot program found that a menu upsell tool increased its average order volume by 6%; a tool that pulls guest data into the point-of-sale (POS) system and handhelds helped create a personalized experience for in-store guests; and an advertising tool helped deliver a greater than 10 times return on ad spend for another restaurant.

Toast President and Chief Financial Officer Elena Gomez said in the prepared remarks that the company raised its 2025 full-year outlook. Gomez added that consumer trends have remained stable into May.  Toast now expects to see 25% to 27% year-over-year (YoY) growth in non-GAAP subscription services and financial technology solutions, up from its earlier guidance of 23% to 25%.  The earnings and the commentary sent the shares 23% higher.

Growth in Latin America

dLocal shares rocketed ahead by nearly 25%. The company said in its most recent quarterly report that total payment volume reached a record $8.1 billion in the first quarter, up 53% YoY. Revenues amounted to $216.8 million, up 18% YoY. The company said that growth was driven by higher cross-border share of volumes.

Nu Holdings’ results disclosed that by the close of the March quarter, its offerings reached nearly 119 million customers, up 19.3 million from a year ago. Active customers were up 19% to 99 million. Nu’s installed customer base in Brazil jumped 14% YoY to 104.6 million, representing 59% of the country’s adult population.  Consolidated revenues grew by 40% YoY to $3.2 billion. Nu shares were 2.6% higher.

Paysafe reported organic revenue growth of 5% in its most recent quarter. The company sees particular promise in the digitization of payments in Latin America, but shares slipped 18.7% through the past five sessions.

“As you know, we’ve anticipated a lower growth rate and margin profile during the first half of the year,” CEO Bruce Lowthers said. “We remain confident that we see acceleration in the second half as we deliver our existing contracts, execute on our sales pipeline, and drive revenue from product initiatives that are already in market.”

Among those initiatives is the company’s digital wallet platform, which has evolved from “single-use consumer wallet solutions … into a more unified platform for two primary segments, with all users able to leverage the functionality of the entire platform,” the CEO said.

The company is also targeting consumers who enjoy online gambling, video gaming and eSports, a group that makes up close to 60% of Paysafe’s Peruvian user base. Later in the call, he said the company expected the region to generate “low double digits, mid-teen double-digit growth” as the year goes on.

“The LatAm market is one that we’re very bullish on, we feel like there are solid growth opportunities in the LatAm market,” Lowthers said.

BILL’s fiscal third quarter earnings detailed that the company’s platform for small businesses processed $79 billion in total payment volume in the third quarter, an increase of 11% YoY. The company said it processed 30 million transactions during the third quarter, up 16% YoY. Total revenue was $358.2 million, gaining 11% from the last fiscal third quarter. BILL’s stock was 1.5% lower.

Affirm shares lost 4.6%.

In its fiscal third quarter reported at the end of last week, Affirm’s gross merchandise value jumped double digits, all but one spending category showed gains, underscoring the appeal of paying over time, and 1.8 million new consumers transacted within the platform’s growing ecosystem.

CEO Max Levchin said in the company’s quarterly shareholder letter that 0% APR monthly installments grew by 44%, tied to 13% of the company’s $8.6 billion in GMV, which was up 36% YoY.  Revenues were up 36% to $783 million.

Separately, Affirm said it had teamed with Costco to offer online shoppers the option to pay over time for transactions. Customers, if approved, will be to able select monthly Affirm payment plans when shopping on Costco’s website.

Robinhood announced an acquisition this past week. The company is on track to buy Canadian crypto enterprise WonderFi for $179 million. The deal represents a roughly 40% premium to WonderFi’s closing price preannouncement. Robinhood shares vaulted 12% higher.