Why the Afterpay (ASX:APT) share price is in focus

The Afterpay Ltd (ASX: APT) share price is one to watch as the BNPL leader eyes a potential US listing after a bumper Q3 result.

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The Afterpay Ltd (ASX: APT) share price is in focus this morning after the buy now, pay later (BNPL) leader’s latest quarterly results.

Why is the Afterpay share price in focus?

This morning, the company reported “strong operating performance” for the period ended 31 March 2021 (Q3 2021). Performance was strong across all regions with underlying sales up 104% on the prior corresponding period (pcp).

On a constant currency basis, Afterpay reported sales up 123% on Q3 2020. That was helped by strong performance in both the United States and the United Kingdom. Sales in the former jumped 2,211% higher on the pcp with UK sales up 277%.

Notably, North America is now the largest contributor to underlying sales. The key business segment also outperformed the “seasonally strong” Q2 2021 results on a local currency basis. The Afterpay share price will certainly be one to watch this morning as investors take in the latest update.

Afterpay reported active customer numbers up 75% to 14.6 million, up from 8.4 million just one year ago. North America and the UK now boast 9.3 million and 1.8 million active customers, respectively.

The Afterpay share price has climbed 6.1% higher in 2021 compared to a 5.7% gain for the S&P/ASX 200 Index (ASX: XJO). However, on a 12-month basis, the BNPL share is up a whopping 335.2% to $126.20 per share.

What else did Afterpay report?

Afterpay reported strong customer acquisition momentum throughout April, up 6% in daily average new customers in the month to date. The March AfterPay Day sale was also a hit. The BNPL group said that event drove a 40% increase in new, active global customers and generated ~6 million referrals to merchants.

The European expansion is also continuing following the group’s Pagantis acquisition and Clearpay launch. That has seen merchants with over $1.5 billion in sales live or in the process of going live across Europe including Spain, France and Italy.

Importantly, Afterpay said gross losses continued to remain below historical rates in all operating regions. It was a similar story for net transaction losses which remain similarly low.

Afterpay to list in the US?

Afterpay also advised it is exploring options for a potential US listing. The company is working with external advisors to explore options given its projected growth. Afterpay intends to remain Australia-headquartered despite its global growth plans.

The Afterpay share price will be one to watch this morning as investors take in the latest numbers and global growth plans.

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Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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