Marqeta Reports 25% Revenue Decline Despite Increased Processing Volume in 2024

Marqeta, Inc. reported a significant decline in its financial performance for the fiscal year ended December 31, 2024, with total net revenue of $507.0 million, down 25% from $676.2 million in 2023. This decrease was primarily attributed to changes in the pricing structure following the August 2023 amendment to its agreement with Block, Inc., which allowed for reduced pricing and altered the revenue presentation for the Cash App program. The total processing volume (TPV) on the Marqeta platform, however, increased by 31% to $291.1 billion, indicating continued growth in transaction processing despite the revenue drop.

The company's gross profit rose to $351.8 million, a 7% increase from the previous year, resulting in a gross margin of 69%, up from 49% in 2023. This improvement in gross profit was driven by a substantial reduction in costs of revenue, which fell by 55% to $155.1 million, largely due to the reclassification of fees owed to Issuing Banks and Card Networks as a reduction in net revenue rather than costs. Operating expenses also decreased significantly, down 39% to $376.3 million, primarily due to lower compensation and benefits expenses following a restructuring plan implemented in 2023.

Strategically, Marqeta has been active in expanding its product offerings and capabilities. In 2024, the company launched several new initiatives, including the Portfolio Migration service to facilitate the transition of existing card programs to its platform and Marqeta Flex, aimed at enhancing buy now, pay later (BNPL) options within payment applications. Additionally, Marqeta completed the acquisition of Power Finance in early 2023, which is expected to bolster its credit card program management capabilities.

As of December 31, 2024, Marqeta had a total of 854 employees, reflecting a reduction in headcount due to the restructuring efforts. The company continues to rely heavily on a small number of customers for its revenue, with Block accounting for 47% of net revenue in 2024, down from 68% in 2023. This concentration poses risks, as any significant changes in the relationship with Block could further impact financial results. Looking ahead, Marqeta anticipates ongoing challenges in achieving profitability, despite a net income of $27.3 million in 2024, primarily due to the forfeiture of the Executive Chairman Long-Term Incentive Award. The company remains focused on expanding its customer base and enhancing its platform to drive future growth.