(Adds details on results, share performance, background and CEO comment)
Feb 27 (Reuters) – Australian buy-now-pay-later firm Afterpay Ltd reported a wider than expected half-yearly loss on Thursday, as mounting costs of acquiring clients in overseas markets eroded the company’s bottom line.
Afterpay added about 700,000 customers in December, bringing its customer base to 7.3 million by the end of the month, more than double that of the same period last year. Much of the growth was underpinned by its U.S. and British operations.
A five-fold jump in U.S. underlying sales during the period was fuelled by a bump in marketing dollar, spent on acquiring and maintaining new merchants. Afterpay also spent more on technology, customer service and legal costs.
It incurred A$80.6 million ($53 million) in operating expenses, compared with A$25.4 million a year ago.
“Our global expansion is accelerating with the U.S. and UK growing at considerably faster rate than what we experienced in ANZ,” chief executive Anthony Eisen said in statement.
The Australian company’s growing customer base reflects the appetite for the buy-now-pay-later concept, especially with younger shoppers, as it sidesteps tougher rules associated with getting a credit card or loan.
The United States is proving to be a key market for the Melbourne-based firm, as it taps the influential but largely nascent region.
Afterpay reported a loss of A$28.9 million ($19 million) in the six months ended Dec. 31, from A$22 million a year earlier.
Trading at nearly 580 times its estimated forward earnings, Afterpay’s shares swung wild in early market hours, and were up 1.86% at 0100 GMT.
$1 = 1.5161 Australian dollars
Reporting by Nikhil Kurian Nainan and Rushil Dutta in
Bengaluru; Editing by Arun Koyyur, Sherry Jacob-Phillips and