The Sezzle Inc (ASX: SZL) share price has flown out of the gates on Wednesday.
In morning trade, the buy now pay later (BNPL) provider's shares are up 22% to $24.54.
Why is the Sezzle share price on fire today?
Investors have been buying the company's shares today after the company released a business update.
According to the release, Sezzle was on form in August and delivered strong top-line growth over the prior corresponding period.
Sezzle's total income increased to US$14 million (A$21.6 million) in August, representing a 44.3% year on year and 11.7% month on month increase. This means that total income as a percentage of underlying merchant sales (UMS) increased 188 basis points year on year to 8.7%.
In addition, for the month of August, Sezzle recorded net income and adjusted EBITDA of US$0.6 million and US$2.4 million. This is a huge improvement on the cash burn it has reported in recent years.
In light of this, the company finished the period with a healthy cash balance of US$60.7 million and US$71.7 million drawn from its US$100 million credit facility.
Other key metrics heading in the right direction are its active subscribers of Sezzle Premium and Anywhere, which exceeded 210,000 subscribers, and its average daily UMS. The latter is up approximately 2.6% in September versus the prior comparable period in August.
'A ripple effect'
Sezzle's Chairman and CEO, Charlie Youakim, was pleased with the company's performance ahead of the key holiday period. He said:
August has proven to be yet another testament to the efficacy and success of our latest product offerings. The continuous growth in our active subscriber base has a ripple effect, fortifying our UMS, Total Income, and Net Income. We are excited about the upcoming holiday period in the fourth quarter, as we have the right economic model for us and our customers.
