Adyen: Bring on the Competition

Adyen, the financial technology company that enables businesses to process payments, manage their finances, and analyse their financial data on a single platform, released their H2 2024 results last week. The company reported a net revenue of €1.08 billion, marking a 22% year-over-year increase, and a net income of €516 million, up 24% year-over-year. 

Based in the Netherlands, Adyen operates in a highly competitive environment. While many competitors focus on reducing platform costs, Adyen differentiates itself by offering products that reduce friction for customers at checkout, leading to higher conversion rates. This strategic focus allows Adyen to compete on value rather than cost. 

Adyen primarily targets larger enterprises, offering a platform capable of processing a high volume of payments, especially during peak times like Black Friday. The company employs a “Land and Expand” strategy to increase its share of customers’ wallets. Initially, customers adopt one of Adyen’s products for a specific location. As they experience the benefits, they gradually integrate more of Adyen’s products across additional locations. This approach not only lowers the cost per payment volume but also consolidates more of the customers’ payment data on a single platform. Notably, 80% of Adyen’s payment growth came from existing customers for H2 2024. 

Adyen remains dedicated to regional expansion and targeting new enterprises, despite this process taking longer than introducing additional products and services to existing clients. Currently, the EMEA region accounts for 60% of Adyen’s revenue. Despite potential challenges posed by geopolitical tensions, Adyen’s established presence in multiple jurisdictions positions it well to navigate increased payment legislation and fend off new market entrants.