The Douugh Ltd (ASX: DOU) share price is plummeting despite the release of a positive update on its first 3 months of trading. In the first hour of trade, the financial wellness app provider's shares are down more than 9% to 25 cents.
Below, we take a look at what Douugh released to the ASX market.
What did Douugh announce?
According to this morning's release, Douugh reported robust growth for its first 3 months of operation. However, investors seem unpleased with the company's latest report, sending the Douugh share price down.
In its announcement, the company advised customer and transactional numbers have surged since its market launch on 17 November 2020.
In particular, customer numbers soared to 8,001, reflecting a compounded monthly growth rate (CMGR) of 364% (month-over-month since November 17). This translated to a total of US$804,297 deposits received. This was an increase of 93% on the CMGR.
In addition, card spend also rose to US$281,512, a jump of 92% on the CMGR.
Douugh further noted that as marketing and onboarding channels are further optimised, it expects customer acquisition run rates to flourish.
For the end of Q2 FY21, the company recorded a cash balance of $16.02 million in the bank. The funds will be proactively used to drive customer growth through a number of measures. They include prioritised product development based on customer feedback, the use of artificial intelligence (AI) from its Autopilot feature, and increase marketing programs.
Douugh also mentioned that its financial wellness app has been downloaded 29,034 times on Apple's iOS platform.
Management commentary
Douugh founder and CEO, Andy Taylor, touched on the company's progress, saying:
Whilst it's early days, we are delighted with our initial traction and the achievement of first revenues. We have been focused on testing and optimising digital media acquisition channels as well as refining our onboarding process.
We have developed a robust and fully automated fraud scoring matrix, and work has begun on the development of the Android App, which we plan to launch in Q4FY21.
…As we increase acquisition spend, our focus continues to be on increasing the sign-up conversion rate and lowering the overall CAC. We will introduce our own integrated Member-get-Member program – providing a monetary incentive to Douugh users for inviting people to sign up to the platform – coupled with the onboarding of Affiliate marketing partners (including social media and YouTube influencers) to expand our distribution channels.
About the Douugh share price
The Dough share price has gained more than 730% since its listing of 3 cents in early October last year. The company's shares hit an all-time high of 49 cents in November.
Based on the current share price, Douugh has a market capitalisation of roughly $173 million.
