The Afterpay Ltd (ASX: APT) share price will be on watch today after it announced a large amount of growth in November 2020.
Afterpay is one of the largest buy now, pay later (BNPL) providers in the world.
What did Afterpay announce?
The leading Australian BNPL business gave a global market update. It said that it hit a new milestone in November 2020 by delivering over $2.1 billion of monthly underlying sales, more than doubling the $1 billion of underlying sales in November 2019. This was an increase of 112%.
November is a very important month because it included the trading of Black Friday and Cyber Monday sales period. In Australian and New Zealand, this period generated growth of underlying sales of 60%.
Afterpay said that new monthly underlying sales records were set in all regions with the US achieving the highest level of monthly sales ever across all regions.
Australia and New Zealand underlying sales went up 54% to $0.9 billion. US underlying sales went up by 186% to $1 billion. UK underlying sales grew by 315% to $0.2 billion.
The BNPL business said that the number of active customers in US increased by 1 million since 30 September 2020. Afterpay also said that in ANZ, it has retailers achieving over $1 million of underlying sales with Afterpay, in-store, in a single day.
Referrals to global retailers continued to grow strongly with over 35 million leads generated during the month of November (up 147%).
Summary thoughts
It’s good to see that Afterpay’s global underlying sales growth is still more than 100% overall. However, it may be worth noting that Cyber Monday last year was on 2 December 2020, whereas this year it was in November (and therefore would seemingly boost November).
Afterpay is growing strongly internationally, but the local ANZ sales growth does seem to be slowing in percentage terms. But that should be expected with the law of large numbers.
With the Afterpay share price at around the $100 level (pre-open) I’m not looking to buy Afterpay shares, particularly if the growth rate is slowing. Instead, I’d rather go for other ASX growth shares involved in payments with much higher margins such as Pushpay Holdings Ltd (ASX: PPH).
