Higher Operating Expenses Bite at Adyen, but Processing Performance Still Impressive

Wide-moat Adyen reported first-half year EBITDA of EUR 356.3 million, up 31% versus the same period a year ago. Nevertheless, results disappointed somewhat as EBITDA was on a sequential basis (EUR 357.3 million) driven by higher operating expenses. Higher salaries to retain talent, expanding the employee base by about 18%, as well as a resumption of travel to meet clients have weighed heavily on profits as operating expenses grew 47%. We maintain our fair value estimate of EUR 1,770 per share.