Revolut reports decline in net profit despite the 45% surge in revenue

Revolut’s delayed annual accounts released on Friday (22nd December) showed that the fintech company recorded a pretax loss in 2022. Its net profit also dropped from £26 million in 2021 to £6 million. This is largely as high costs offset the benefits enjoyed by the broader fintech industry in the form of higher interest rates.

In 2021, the firm reported pre-tax profits of £40 million amid a surge in cryptocurrency trading. In comparison, it recorded a pre-tax loss of £25.4 million in 2022. Even so, its revenue increased by 45% year-on-year to £923 million while its interest income was up from £1.7 million to £83 million. The increase was largely due to higher interest rates.

The British fintech’s results for 2022 were due for filing by the end of September; nine months after the end of its 2022 financial year. Nonetheless, Companies House granted it an extension for the second consecutive year to the end of December.

Last year, Revolut was under scrutiny for what its auditor BDO asserted was the bulk of its revenue probably being “materially mistated”.

In its annual report, Revolut’s CEO, Nikolay Storonsky stated, “Looking ahead, our focus is on continued growth across all our markets. We remain committed to our ongoing UK banking licence application in addition to bringing the Revolut app to new markets and customers around the world.”

According to the company, its customer base has increased by close to 10 million from 2021. At the same time, its expenses have increased amid the launching of new products, global expansion, and an increase in its headcount.