What To Expect From Farfetch’s (FTCH) Q3 Earnings

Jabin Bastian /
2022/11/16 4:24 am EST

Online luxury marketplace Farfetch (NYSE: FTCH) will be announcing earnings results tomorrow after the bell. Here's what you need to know.

Last quarter Farfetch reported revenues of $579.3 million, up 10.7% year on year, beating analyst revenue expectations by 2.26%. It was a mixed quarter for the company, with growing number of users but slow revenue growth. The company reported 3.84 million active buyers, up 13.2% year on year.

Is Farfetch buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Farfetch's revenue to grow 2.43% year on year to $596.7 million, slowing down from the 33% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.20 per share.

Farfetch Total Revenue

The analysts covering the company have been growing increasingly bearish about the business heading into the earnings, with revenue estimates seeing 4 downward revisions over the last thirty days. The company missed Wall St's revenue estimates three times over the last two years.

Looking at Farfetch's peers in the online marketplace segment, some of them have already reported Q3 earnings results, giving us a hint of what we can expect. The RealReal delivered top-line growth of 20% year on year, missing analyst estimates by 4.35% and Airbnb reported revenues up 28.9% year on year, exceeding estimates by 1.26%. The RealReal traded down 8.57% on the results, and Airbnb was down 3.21%. Read our full analysis of The RealReal's results here and Airbnb's results here.

There has been positive sentiment among investors in the online marketplace segment, with the stocks up on average 20.2% over the last month. Farfetch is up 34.3% during the same time, and is heading into the earnings with with analyst price target of $15.10, compared to share price of $10.2.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

The author has no position in any of the stocks mentioned.