Like most tech shares today, the Splitit Ltd (ASX: SPT) share price is sinking deep into the red this morning.
At the time of writing, the buy now pay later provider's shares are down 4% to $1.14.
Why is the Splitit share price sinking?
A selloff of tech shares this morning is dragging the Splitit share price lower and appears to have overshadowed its full year results release.
At the time of writing, the S&P/ASX All Technology Index (ASX: XTX) is down over 5.3%.
This follows a very poor night of trade on Wall Street's Nasdaq index after bond yields continued to climb.
How did Splitit perform in FY 2020?
For the 12 months ended 31 December, Splitit reported a 179% increase in Merchant Sales Volume (MSV) to US$246 million.
Based on its fourth quarter performance, the company's MSV annualises to US$345 million. This is 40% higher than its FY 2020's MSV.
This led to the company reporting a 300% increase in gross revenue to US$8.4 million.
However, also growing was its loss after tax, which came in at US$25.47 million. This compares to a loss of US$21.47 million and leaves it with a cash balance of US$92.8 million.
What were the drivers of its growth?
Splitit's growth was underpinned by increases in customer and merchant numbers, plans, and average order sizes.
At the end of the period, the company had 231,000 active shoppers on its platform. This was up 94% on the prior corresponding period.
From these, the company achieved a 94% increase in initiated plans to 257,000 and a 45% lift in average order value to US$949.
Management commentary
Splitit's CEO, Brad Paterson, commented: "Splitit delivered a breakout year with record financial and operational results in FY20, despite a globally challenging year due to the COVID-19 pandemic. Our annualised MSV hit US$345M in Q4 and revenue (non GAAP) increased 300% to US$8.4M, annualised to US$11.6M in Q4."
"We formed foundational partnerships with Stripe, Visa and Mastercard during the year which enabled innovation and is beginning to accelerate merchant acceptance. With our new US$150M receivables warehouse funding facility from Goldman Sachs in place, we are expecting to deliver another step change in growth in 2021."
No guidance was given for the year ahead. However, management advised that it expects its MSV and revenue growth trajectory to continue.
Following today's decline, the Splitit share price is now down 12% in 2021.
