The all-in-one fintech app Revolut has launched its annual report for 2021. Whereas 2021 ended greater than a yr in the past, this report contains some vital figures as the corporate practically tripled its income between 2020 and 2021. Due to this explosive development trajectory, the corporate reached profitability for the primary time.

Revolut’s monetary success begins on the high of the funnel. On the finish of 2021, Revolut had greater than 16 million clients, representing a 46% improve in comparison with 2020.

Revolut’s core product is an account to ship, maintain and obtain cash mixed with a fee card. Whereas Revolut has but to acquire a banking license within the U.Okay. (its dwelling nation), the corporate now has a full banking license in Lithuania.

It may well use this license throughout the European Financial Space by passporting guidelines, which implies that Revolut might be thought of as a financial institution in Europe. Along with these primary banking options, the corporate gives a ton of fintech merchandise — however extra on that later.

First, let’s take a look at the massive figures and convert them to {dollars} utilizing right now’s trade charge:

• In 2021, Revolut generated $769 million (£636 million) in income vs. $266 million (£220 million) in 2020.
• In 2021, Revolut reported a internet revenue of $31 million (£26 million) vs. a internet lack of $270 million (£223 million) in 2020.
• Gross margin additionally jumped from 33% to 70% between 2020 and 2021.

“Now we have achieved our first full yr of revenue and proven that we are able to speed up buyer development, at scale, and develop income throughout all of our product strains,” Revolut co-founder and CEO Nik Storonsky stated within the launch. “In 2021 we have been granted a full banking licence from the European Central Financial institution and welcomed thousands and thousands of recent clients. We additionally launched a number of new merchandise and noticed extra exercise from our buyer base.”

Every thing is shifting up and to the best. In different phrases, issues are wanting nice at Revolut proper now. That’s why the corporate managed to boost a $800 million funding spherical at a $33 billion valuation in the midst of 2021.

Producing income from crypto buying and selling and different charges

Revolut’s income comes from a number of sources. Whereas clients can create an account totally free, customers need to pay some charges for some cash administration companies. Essentially the most enthusiastic clients may also select to pay for a premium subscription plan to waive some charges and entry further options.

On high of that, Revolut generates income from interchange charges. Each time a Revolut customers pay for one thing with a card, retailers need to pay some card transaction charges. These charges are cut up between the service provider’s financial institution, the cardboard scheme (Visa or Mastercard for instance) and the cardboard issuing financial institution (Revolut in that case). Whereas Revolut solely will get a tiny fraction of the transaction quantity, it could add up when you’ve got thousands and thousands of consumers.

Income could be damaged down in three large pillars:

• Playing cards and interchange symbolize 23% of whole income ($180 million/£149 million).
• Subscriptions symbolize 17% of whole income ($129 million/£107 million).
• International trade and wealth companies symbolize 55% of whole income ($421 million/£349 million).

Whereas the primary gadgets are fairly straightforward to grasp, the final one contains fairly just a few Revolut companies. Revolut began as a seamless overseas trade app mixed with a multi-currency card. Revolut expenses a minimum of 0.5% in trade charges above a sure restrict totally free customers. For everybody (together with paid customers), there are further charges whenever you trade cash on the weekend or when you’re exchanging an unusual forex.

Revolut additionally helps you to commerce cryptocurrencies, shares and commodities like gold and silver. For these monetary merchandise, Revolut expenses some vital charges — between 1.49% and 1.99% for crypto transactions, between 0.5% and 1.5% for valuable metals.

2021 was a particular yr with a crypto growth that led to a spike in crypto transactions in addition to some renewed curiosity from retail buyers for shares. Keep in mind, 2021 began with the GameStop brief squeeze on WallStreetBets.

Whereas 2022 may not look as dramatic as 2021, Revolut already shared a brief preview of final yr’s numbers. In 2022, the corporate’s income elevated as soon as once more to greater than $1 billion (£850 million). It’s a 30% improve, which is far decrease than the 189% improve in 2021. And but, many large-scale startups could be fairly pleased with a 30% income bounce. Revolut now has 27 million clients.

Now, it’s time to stabilize the enterprise as Revolut didn’t launch its monetary statements on time. If the corporate needs to go public within the coming years, it should enhance its inner processes. That might additionally assist relating to acquiring a banking license within the U.Okay.