Nexi Group (BIT:NEXI) is an Italian based fintech that enables payment services in 25 countries across Europe. The company acts as a white label card issuer and merchant acquirer with 2.9 million active point-of-sale devices, 140 million cards managed on behalf of 1,000 financial institutions. These operating metrics drove healthy 2023 financial results of 3.4 billion Euros in revenue, up 7% YoY, and 1.8 billion Euros EBITDA, up 10%, generating a strong 52% EBITDA margin.
While Europe may be unified economically through the Euro currency, the payment schemes are still fragmented with 150 different payment methods, including 10 unique national debit systems, all of which must navigate local regulations and tax codes. Furthermore, payment card penetration is low in Nexi’s target market (40%), and transaction volume is growing 10% per annum.
Nexi’s strategy is to leverage processing scale from customers utilizing a suite of services in local markets. Size, variety and proximity are key competitive variables for Nexi. The company is executing on a well thought out strategy and has guided for mid-single digit YoY growth for 2024 revenue, mid-to-high single digit growth for EBITDA, and an 100 bps increase in EBITDA margin (to 53%).
US investors may not hear about overseas fintech companies frequently so Nexi’s industrial strength and reach is as good a place to start as any.
