NAGA’s Revenue Drops 36% in Q1 2023 despite Growth in Active Users

Tuesday, 04/04/2023 | 16:15 GMT by Solomon Oladipupo
  • The neo-brokerage's revenue jumped 63% YoY to EUR 18M in Q1 2022.
  • The volume worth EUR 37 billion was traded by NAGA users in Q1 2023.
NAGA

NAGA Group, a Germany-based fintech company, saw a drop of 36% year-over-year (YoY) in its group revenue during the first quarter (Q1) of 2023. According to the neo-brokerage’s preliminary unaudited figures published on Tuesday, revenue generated during the first three months came in at EUR 11.6 million, which is a decrease from the EUR 18 million posted during the same period last year.

NAGA’s earnings before interest, taxes, depreciation and amortization (EBITDA) collapsed by nearly 200% from EUR 5 million in Q1 2022 to EUR 1.7 million at the end of March. During Q1 2022, the group revenue and EBITA had surged 63% YoY to EUR 18 million and 67% YoY to EUR 3 million, respectively.

In early February, NAGA reported a profitable start to the year with a profit of about EUR 1.5 million year-to-date. At the time, the Group said it generated a revenue of close to EUR 6 million with expenses kept at around EUR 4.5 million.

NAGA Records Active Users Growth

As a fintech company, NAGA Group operates the regulated neo-broker, NAGA; the neo-banking app, NAGA Pay; and the cryptocurrency platform, NAGAX. However, despite the drop in revenue and EBITDA, the number of NAGA’s active traders jumped 30% from 16,300 in Q1 2022 to 21,250 last month. Additionally, a total of 2.9 million trades were executed in Q1 2023, NAGA noted, adding that trades were worth EUR 37 billion.

“The assets under custody have grown to EUR 35 million which is 45% more than the last reported HY1 2022 figure (EUR 24 million),” NAGA wrote in the update.

Furthermore, during the first quarter of the year, NAGA said it brought down its monthly cost to an average of EUR 3.3 million, which is 40% lower compared to the average of EUR 5.5 million maintained during the same period last year. On top of that, the Group “expects a further cost decrease by around 20% during Q2 2023 whilst keeping its growth trajectory.”

In addition, NAGA said it spent 70% less on marketing during Q1 2023, with the figure dropping from EUR 11.5 million in Q1 2022 to EUR 3.5 million last month. Despite spending less on marketing, NAGA, which also provides social trading services, noted that it acquired 11% more new users at the end of March 2023.

“The improvement in the core acquisition metrics is driven by the focus on marketing efficiency and AI-driven marketing intelligence combined with a fully restructured marketing strategy,” NAGA added.

NAGA Open to Strengthening Capital Base

Speaking on the figures, Benjamin Bilski, the Founder and CEO of NAGA Group, noted that the company is satisfied with how it performed during the first quarter “especially looking at growing user activity and well-improved user acquisition.”

Bilski added: “The costs are under control and we have a good grip on the business expansion. We are creating a foundation to run this business profitably and the past month's trend proves that.”

“However, given the fact that we incurred significant losses last year and despite the current merger discussions, we are keeping our eyes open for opportunities to strengthen our capital base to ensure we can execute our plans.”

Vida Markets' new hire; funding of TerraPay, Bidget; read today's news nuggets.

NAGA Group, a Germany-based fintech company, saw a drop of 36% year-over-year (YoY) in its group revenue during the first quarter (Q1) of 2023. According to the neo-brokerage’s preliminary unaudited figures published on Tuesday, revenue generated during the first three months came in at EUR 11.6 million, which is a decrease from the EUR 18 million posted during the same period last year.

NAGA’s earnings before interest, taxes, depreciation and amortization (EBITDA) collapsed by nearly 200% from EUR 5 million in Q1 2022 to EUR 1.7 million at the end of March. During Q1 2022, the group revenue and EBITA had surged 63% YoY to EUR 18 million and 67% YoY to EUR 3 million, respectively.

In early February, NAGA reported a profitable start to the year with a profit of about EUR 1.5 million year-to-date. At the time, the Group said it generated a revenue of close to EUR 6 million with expenses kept at around EUR 4.5 million.

NAGA Records Active Users Growth

As a fintech company, NAGA Group operates the regulated neo-broker, NAGA; the neo-banking app, NAGA Pay; and the cryptocurrency platform, NAGAX. However, despite the drop in revenue and EBITDA, the number of NAGA’s active traders jumped 30% from 16,300 in Q1 2022 to 21,250 last month. Additionally, a total of 2.9 million trades were executed in Q1 2023, NAGA noted, adding that trades were worth EUR 37 billion.

“The assets under custody have grown to EUR 35 million which is 45% more than the last reported HY1 2022 figure (EUR 24 million),” NAGA wrote in the update.

Furthermore, during the first quarter of the year, NAGA said it brought down its monthly cost to an average of EUR 3.3 million, which is 40% lower compared to the average of EUR 5.5 million maintained during the same period last year. On top of that, the Group “expects a further cost decrease by around 20% during Q2 2023 whilst keeping its growth trajectory.”

In addition, NAGA said it spent 70% less on marketing during Q1 2023, with the figure dropping from EUR 11.5 million in Q1 2022 to EUR 3.5 million last month. Despite spending less on marketing, NAGA, which also provides social trading services, noted that it acquired 11% more new users at the end of March 2023.

“The improvement in the core acquisition metrics is driven by the focus on marketing efficiency and AI-driven marketing intelligence combined with a fully restructured marketing strategy,” NAGA added.

NAGA Open to Strengthening Capital Base

Speaking on the figures, Benjamin Bilski, the Founder and CEO of NAGA Group, noted that the company is satisfied with how it performed during the first quarter “especially looking at growing user activity and well-improved user acquisition.”

Bilski added: “The costs are under control and we have a good grip on the business expansion. We are creating a foundation to run this business profitably and the past month's trend proves that.”

“However, given the fact that we incurred significant losses last year and despite the current merger discussions, we are keeping our eyes open for opportunities to strengthen our capital base to ensure we can execute our plans.”

Vida Markets' new hire; funding of TerraPay, Bidget; read today's news nuggets.

About the Author: Solomon Oladipupo
Solomon Oladipupo
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About the Author: Solomon Oladipupo
Solomon Oladipupo is a journalist and editor from Nigeria that covers the tech, FX, fintech and cryptocurrency industries. He is a former assistant editor at AgroNigeria Magazine where he covered the agribusiness industry. Solomon holds a first-class degree in Journalism & Mass Communication from the University of Lagos where he graduated top of his class.
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