Green Dot, a leading fintech company, has experienced a significant drop in shares due to a decrease in adjusted earnings guidance and a loss in the third quarter. The stock has fallen by over 50% since the beginning of the year, reaching an all-time low of $7.49 during midday trading.
The company now projects adjusted earnings of $1.62 to $1.69 per share, lower than the previously announced guidance of $1.80 to $1.90 per share. This revision is attributed to challenges in revenue and costs associated with processor conversions completed during Q3. While these difficulties are expected to persist into Q4, it is anticipated that they will be resolved by year-end.
Additionally, Green Dot foresees increased expenses in the fourth quarter due to ongoing investments in its regulatory and compliance infrastructure.
In the third quarter, Green Dot reported a loss of $6.3 million or 12 cents per share, in contrast to a profit of $4.7 million or nine cents per share in the same period last year. Adjusted earnings, excluding one-time items, were 14 cents per share, falling short of FactSet analysts’ expectations of 20 cents per share.
These recent developments have raised concerns about Green Dot’s financial position and future prospects in the market.
