This is just a little update on Global-e and me. I had had a full-sized position, although it was my smallest full-sized position, but after looking at the results and reading the conference call, I sold out completely on Thursday, Friday, and yesterday (Monday). Please don’t follow me though. It may go straight up from here. It’s just the way I looked at it and I’m often wrong.
Why did I decide to sell? Well I’ve had doubts for a long time, especially about their Shopify arrangement. First of all, with Shopify having 14% of Global’s stock, would they be unduly influenced by what Shopify wants.
I may have misunderstood, but it sounded as if they were turning over all their companies who were on both Global and Shopify to run on Shopify’s new platform, which is copied from Global’s or integrates some of Global’s abilities. That didn’t sound good to me. To me it meant less revenue to Global from each of these.
In addition I was afraid they were going to pull a Bill.com, who got a large number of new customers from the banks but very little revenue from each. I worried that Global was going to do the same with Shopify. A large number of new customers but very little revenue from each.
And then I looked at their results in what I had expected would be an outstanding quarter. Sure they have seasonality and their quarter starting in January naturally always has less revenue than their Xmas quarter because their customers sell luxury items… but their 3rd quarter was always up sequentially from their 2ndquarter. In 2022 it was up 21.0% sequentially. This year it was flat, up from $133.3M to $133.6M.
Then their year over year results. In 2021 revenue was up 77% in this quarter. In 2022 revenue was up 79% in this quarter. In 2023, revenue was up 27% this quarter. That was terrible.
Then their GMV year-over-year gain went from 86% to 77% (no complaints with that), to 35% this year. Again terrible.
In the Conf Call they said that they’ve spotted a little pick-up in the last few weeks. Well duh… we are in the Xmas season.
Yes, their adjusted EBITDA and their gross margin both did fine, but I just was worried about this company, and disappointed. I decided to sell. I got out at prices roughly from $30.00 to $32.70. They were at $31.75 last I looked.
Again, they may do just fine! They are way down from their highs. Make your own decisions.