# Marqeta’s Strategic Initiatives Set for Transformative Growth in 2025

## Expanding Customer Engagement Through Innovative Loyalty Solutions

Marqeta aims to leverage its strong U.S. customer base by transforming traditional airline loyalty programs into dynamic engagement solutions. Historically, airline credit cards have provided limited user experience and value, leading one notable airline to seek a partner capable of enhancing customer interaction throughout their journey. After considering various options, they chose Marqeta for its innovations in payment technology and comprehensive program management. This partnership allows the airline to focus on improving passenger experiences while Marqeta handles risk management and compliance.

Notably, this approach marks a significant shift from conventional loyalty programs to a model that emphasizes daily customer engagement. Marqeta’s European sector is experiencing substantial growth, boasting a total processing volume (TPV) increase of over 100% in Q4. The company secured a key contract to provide card processing and program management services for one of Europe’s fastest-growing tech firms, which operates primarily in Central and Eastern Europe.

## Global Expansion and Multinational Engagement

Despite having a presence in multiple regions, Marqeta’s customers often begin their journeys in a single market before expanding globally. Currently, eight of Marqeta’s top ten clients utilize its platform in more than one region, often starting in the U.S. or Canada. However, this trend is anticipated to evolve as Marqeta engages with more established multinational companies that have embedded finance goals. In Q4, Marqeta signed its first multicountry solution deal with a U.S.-based B2B payments company, facilitating streamlined efforts across U.S. and European operations.

## Strategic Pillars Aiming for Growth in 2025

Looking ahead, Marqeta plans to capitalize on its past achievements to further prepare for a transformative 2025. The firm seeks to become the preferred partner for embedded finance and fintech innovation through three strategic pillars: enhancing platform breadth, expanding service offerings, and reinforcing momentum in payments innovation. Progress has already been made in these areas early in 2025.

### Welcoming the American Express Network

A significant milestone set for late 2025 involves incorporating the American Express network into Marqeta’s offerings. This addition will offer customers greater versatility in credit and debit card programs. By leveraging the American Express agile partnership platform, Marqeta aims to boost availability for fintech partners, allowing them to launch cards efficiently. Additional details will emerge as the launch date nears.

### Acquiring Necessary Licensing Infrastructure

Enhancing the company’s European service capabilities is essential, especially for businesses involved in embedded finance. In the U.K. and Europe, companies need an Electronic Money Institution (EMI) license to issue electronic money. Marqeta previously partnered with TransactPay to address licensing challenges, but feedback highlighted the complexity of working with multiple partners. Thus, Marqeta opted to acquire TransactPay, aiming to integrate these essential services into its offerings. The acquisition awaits regulatory approval, which could last up to six months, with financial implications deferred for later discussion.

## Enhancing Solutions for Customer Pain Points

As Marqeta progresses into 2025, expanding its service solutions remains a priority. The company plans to delve deeper into customer needs, particularly concerning risk management and compliance, exemplified by its real-time decisioning risk product. This service has doubled its revenue from 2023 to 2024 and is now utilized by over 20 global customers, bringing higher gross margins due to lower transaction costs.

In addition to enhancing compliance capabilities, Marqeta will introduce further services to improve customer visibility into program performance. This development offers users a holistic view of how their offerings perform on the Marqeta platform.

## Innovating in Payment Solutions

Marqeta continues to lead in payment innovations, particularly with its Buy Now Pay Later (BNPL) solutions. The company was an early adopter of virtual cards, aiding merchant adoption. Its ability to empower providers with BNPL options via card issuance has opened new pathways for transactions.

Now, Marqeta has launched Visa flexible credentials in the U.S., garnering traction among various client wallets. Additionally, partnerships with Mastercard regarding their One platform will extend flexible card services to a broader client base. Progress on Marqeta Flex is expected to enhance BNPL payment delivery within existing payment flows.

## Strong Q4 Financial Performance

In Q4, Marqeta’s strong financial results echo its impressive operational resilience. The company achieved a TPV growth rate of 29%, correlating with improved metrics across net revenue, gross profit, and adjusted EBITDA margins, which reached 9%. Contributing factors include a favorable business mix, higher-than-expected performance from new programs during the holiday season, and a successful partnership incentive.

In conclusion, Marqeta’s forward-looking strategies focus on both deepening their existing services and innovative payment solutions, all while maintaining a commitment to compliance and customer satisfaction as they encounter a promising 2025.# Marqeta Reports Q4 Growth and 2025 Expectations

Marqeta’s moderated expense growth led to a record adjusted EBITDA of $13 million for the quarter. Let’s delve into the Q4 highlights before outlining our expectations for 2025.

## Fourth Quarter Performance Overview

During Q4, total payment volume (TPV) reached $80 billion, reflecting a 29% year-over-year increase, although this represents a slight deceleration compared to the previous quarter. Notably, TPV growth has remained consistent over the last seven quarters, fluctuating between 29% and 33%, signifying Marqeta’s significant scale up. Comparatively, in Q1 of 2024, we experienced our first day with over $1 billion in TPV, while Q4 saw 17 instances surpassing this mark.

Non-Block TPV demonstrated even more robust performance, growing nearly twice as fast as Block TPV. This surge was driven by diverse use cases from various customers, consistent with trends observed over several quarters. Areas such as financial services, lending—including Buy Now, Pay Later (BNPL) solutions—and expense management all kept pace with the company’s overall growth rate in Q4, bolstered particularly by our non-Block neobanking clients whose TPV doubled year over year. Lending growth, particularly BNPL, benefited from wider adoption of pay-anywhere card solutions and a greater presence in digital wallets, alongside Klarna’s transition to our platform in Europe in October, as highlighted in our previous call.

In terms of expense management, growth improved this quarter thanks to strong user acquisition rates, while on-demand delivery growth remained subdued due to more mature market dynamics. Three customers opted to reduce card transaction volume by integrating their platforms directly with specific merchants, a topic we covered last quarter.

## Financial Results Snapshot

Q4 net revenue registered at $136 million, achieving a 14% year-over-year growth rate. This rate represents a four-point decline from the previous quarter, influenced by more challenging year-over-year comparisons and a larger share of revenue derived from Powered by customers, who generally yield a lower net revenue take rate due to minimal associated costs.

This shift in mix was partially mitigated by an increase in our Powered by Marqeta take rate, which improved by over one percentage point, driven by a faster growth rate in consumer use cases compared to single-use commercial virtual cards. For Q4, Block’s revenue concentration represented 46%, a decrease of one percentage point from Q3 2024, and down five percentage points from Q4 2023. Meanwhile, non-Block revenue growth accelerated, aided by the introduction of new programs. Our net revenue take rate held steady at 17 basis points, unchanged from the prior quarter.

Gross profit reached $98 million in Q4, signifying an 18% year-over-year increase, leading to a 72% gross profit margin—approximately four percentage points higher than forecasted. This increase was driven by three main factors: the growth contribution from new program launches, which exceeded expectations due to stronger holiday season TPV; a less significant impact from program launch delays than anticipated; and unforeseen benefits that contributed positively.

Notably, we secured a performance incentive, yielding an additional point of growth after surpassing an unintended milestone. Furthermore, a favorable customer mix enhanced growth, as several high-yield use cases outperformed projections. Non-Block gross profit growth paralleled last quarter’s performance, increasing at a faster rate than the overall company, while our gross profit take rate remained at 12 basis points, consistent with previous periods.

## Cost Management and Future Outlook

Q4 adjusted operating expenses totaled $86 million, up 7% year over year—slightly better than anticipated. We are concentrating on strategic hiring while navigating multiple geographies to attract top talent, reducing dependency on external professional services. The increasing scale of our operations allows platform-related costs to grow more slowly than our transaction volume and gross profit. Consequently, Q4 adjusted EBITDA reached a record $13 million, representing a margin exceeding 9%, both all-time highs for Marqeta.

In terms of GAAP results, we reported a net loss of $27 million in Q4, which included a $10 million expense stemming from the Power acquisition, off-set by $11 million in interest income. We concluded the quarter with $1.1 billion in cash and short-term investments. Over the full year of 2024, TPV growth stood at 31%, while net revenue contracted by 25%. Even as gross profit increased by 7%, these figures do not fully reflect the underlying business strength due to the Cash App renewal and changes in revenue presentation that affected early-year year-over-year comparisons. The latter half of 2024 clearly indicates our trajectory towards sustainable profit growth.

For 2024, adjusted EBITDA was $29 million, indicating a 6% margin on revenue—an important milestone as we transition from previous negative EBITDA days, aiming for GAAP profitability by the end of 2026. Before shifting to our 2025 expectations, I’d briefly like to discuss share buybacks. We currently have $80 million left on the Q2 2024 authorization.

In Q4, share buyback activity was minimal as the former 10b5-1 plan expired shortly after our November earnings release. The company has been restricted from trading or initiating a new plan due to legalities. Nevertheless, we anticipate resuming our share repurchase activities soon, believing that the current valuation does not fairly reflect the company’s worth or market potential. Our board has therefore authorized an additional $300 million for share buybacks, raising the total authorization to $380 million.

## Expectations for 2025

Looking forward, our projections for full-year 2025 target net revenue growth between 16% and 18%, aligning closely with our performance in the latter half of 2024. This growth is anticipated to be supported by TPV rises in the mid- to high-20s, contingent on a stable macroeconomic backdrop akin to past quarters.

However, TPV growth will be pitted against a lower net revenue take rate. This decline primarily stems from heightened growth among our Powered by Marqeta customers, whose lower take rates impact net revenue growth more than gross profit. Additionally, expected contract renewals could yield lower pricing impacts.

New program sales initiated since revamping our sales efforts in late 2022 and launched at the start of 2024 should contribute over $40 million to net revenue, equating to about 5% of our 2025 net revenue growth based on last year’s performance, though this falls short of our previous $60 million target due to delays in program launches and ramp-ups this year.

Marqeta Projects Modest Growth Amid Regulatory Challenges and Acquisitions

The financial landscape for Marqeta is evolving, particularly due to a more stringent regulatory environment with its banking partners. In our recent discussion, we characterized the progress in launching delayed programs in 2024 as favorable, although the timeline has yet to align with our 2023 metrics.

Growth Expectations and Profitability Metrics for 2025

Looking ahead, we forecast gross profit growth for 2025 to fall between 14% and 16%, translating to a gross profit margin in the high 60s. However, gross profit expansion is anticipated to lag behind net revenue growth slightly, a concern linked to contract renewals that will adjust pricing while keeping revenue costs steady. Although contract renewals typically occur each year, the volume expected in 2025 surpasses our usual experiences as we refresh over 80% of our total payment volume (TPV) from 2022 and 2023, post-fintech boom.

Most notably, significant contracts are scheduled for renewal in 2025, and adjusted operating expenses are projected to rise in the mid-to-high single digits. This focus on efficiency aims to ensure robust investment discipline and reap economies of scale. As a result, we anticipate an adjusted EBITDA margin of 9% to 10%, yielding an adjusted EBITDA of more than $50 million for the year.

Acquisition of TransactPay Enhances European Offerings

In a strategic move, we are set to acquire TransactPay, a decision aimed at bolstering our program management capabilities in Europe. We expect to finalize this acquisition by the start of Q3 2025, contingent upon receiving the necessary regulatory approval for EMI licenses. The acquisition price is set at EUR 45 million, plus a potential EUR 5 million tied to performance metrics.

We believe that combining TransactPay with Marqeta’s offerings will lead to customer growth in three vital areas: increased adoption of our program management services by European clients, attracting new customers who prefer a consolidated provider for processing and management, and simplifying geographic expansion across our platforms in the U.S., Canada, and Europe. The financial impact will primarily manifest in new sales, which typically contribute to profitability over a period exceeding one year. Our forecasts for 2025 anticipate that two quarters of TransactPay’s operations will be reflected in our P&L, contributing approximately one percentage point to both net revenue and gross profit growth, while remaining neutral regarding adjusted EBITDA.

Changes to Incentive Accounting—Anticipating Variability

As we approach the four-year anniversary of our IPO, changes are forthcoming regarding how we record incentives starting in Q2 2025. Historically, our accounting practices required us to book incentives only as earned, which led to fluctuating gross profit growth throughout the year. This method resulted in a noticeable dip in Q2 performance. The new approach will involve accruing incentives quarterly based on forecasted annual contract tiers. This shift is expected to reduce variances in quarterly incentive recordings and clarify our growth trajectory on a consistent basis.

Quarterly Revenue and Gross Profit Growth Outlook

For Q1 2025, we project net revenue growth between 14% and 16%, a slight improvement compared to our exit from 2024. This initial pace is supported by the conclusion of our renegotiated platform partner agreement, after having depressed revenue growth since the start of 2024. As the quarters progress, we expect an acceleration in net revenue growth, increasing approximately one percentage point each quarter fueled by new program launches and service expansion.

Focusing on gross profit, first-quarter growth is anticipated at 11% to 13%, marking our lowest quarter for the year before revenue growth begins to trend upward. This projection reflects a six-point reduction from Q4 2024 due to a combined two-point growth contribution from an incentive tied to annual performance and a four-point negative impact from prior accounting irregularities. We predict Q2 2025 to showcase the highest growth rate, likely in the mid-to-high teens, as we roll out new programs and continue to adopt innovative services.

The anticipated growth for Q3 and Q4 is expected to hover in the mid-teens but may slow due to the anticipated impact of renewals, which are expected to offset new program benefits. In reported terms, we expect Q1 gross profit growth to align with our earlier projections, with subsequent quarters demonstrating mixed impacts influenced by changes in incentive accounting and TransactPay’s contributions.

Expense Management and Future Projections

Investment strategies for 2025 will largely be directed toward enhancing platform capabilities and innovation, along with expanding go-to-market resources to accommodate rising demand while ensuring high compliance standards are maintained. In terms of adjusted operating expenses, Q1 is projected to rise in the mid-to-high single digits, in line with growth witnessed in Q4 2024, while Q2 could decrease slightly due to an easier year-on-year comparison, leading to mid-single-digit growth. Conversely, similar to Q1, Q3 and Q4 are projected to rise, potentially exceeding the growth rates established in Q1.

The expected adjusted EBITDA margin for Q1 stands at 10% to 11%, showing slight improvement over Q4 2024 figures, while sustaining similar margins of about 9% in the latter quarters.

# Growth Strategies: A Financial Overview as We Conclude 2024

In summary, we enter 2024 with a strong foundation. Multiple impactful business improvements are set for 2025. These developments will facilitate sustainable, profitable growth for the long-term future.

Driving Factors for Optimism

Our excitement and confidence stem from four key factors. Firstly, our sales pipeline indicates that embedded finance is nearing a breakout. This will push card-issuing solutions that enhance user engagement and optimize monetization of existing customer bases. Additionally, our 2025 technology roadmap is expected to substantially expand the platform services we deliver, bolstering our leadership in payment innovation. This expansion not only enhances the value we provide our customers but also strengthens our relationships with them.

Secondly, our European business is experiencing rapid growth. We are improving our program management capabilities to align our value proposition with that of the U.S. market. Finally, our platform continues to achieve new economies of scale, leading to increased profit margins. This positions us well for accelerated growth in 2026 and beyond. A combination of strong gross profit growth and expanding adjusted EBITDA margins will drive value creation well after our anticipated exit in 2026 with GAAP profitability. I will now turn it over to the operator for questions.

Questions & Answers

Operator

Thank you. We will now begin the question-and-answer segment. [Operator instructions] One moment, please, while we assess for questions. Our first inquiry comes from Tien-Tsin Huang with JPMorgan.

Tien-Tsin Huang — Analyst, JPMorgan Chase and Company

Thank you for the detailed insights, Mike. I know you have a lot on your agenda. Could you clarify the acquisition of TransactPay and elaborate on what functionalities it provides that you couldn’t develop independently?

Mike Milotich — Chief Financial Officer

Sure. Let me give you an overview of TransactPay. This company acts as a BIN (Bank Identification Number) sponsorship provider authorized as an e-money institution. It is regulated to issue e-money and facilitate payments across the U.K. and EU.

What sets TransactPay apart is its ownership of the BINs in Europe. Unlike in the U.S., where we depend on banks for BIN sponsorship, this acquisition enables us to be the member of the network, controlling the BINs ourselves. This shift allows for greater control over our offerings.

Customers often face complications when dealing with multiple entities for processing and licensing. TransactPay provides a unified solution, simplifying the customer experience. Though we could have developed this independently, doing so would involve considerable time and compliance effort—potentially taking years. Given the dynamism in Europe, we wanted to avoid delays. Moreover, TransactPay brings specialized knowledge and leadership in the market, having delivered consistent performance over the years.

Integrating their capabilities into our value proposition will be seamless. We believe this acquisition will allow us to attract new European customers who seek comprehensive program management solutions, ultimately enabling our non-European clients to enhance their presence in Europe with similar high-quality service.

We are enthusiastic about this acquisition and look forward to completing it in the coming months.

Tien-Tsin Huang — Analyst, JPMorgan Chase and Company

Thanks for the detailed explanation. I have a follow-up regarding recent business wins, particularly an airline contract. Can you share who you were competing against for this deal? Additionally, how does your pipeline look now that the banking aspects seem more solidified? I realize we may have to wait for TransactPay to show its influence on your financials, but can you characterize the current state of your pipeline?

Mike Milotich — Chief Financial Officer

Our pipeline looks strong, driven by two primary factors. From the embedded finance perspective, as highlighted in my earlier remarks, we are observing increasing momentum. Currently, about two-thirds of our pipeline comprises embedded finance clients. Historically, only about a third of our new bookings were in this area. The significant increase reflects a healthy trend.

Many customers engaged in this segment are large enterprises in different industries. Consequently, navigating their decision-making processes can be complex and lengthy, as they incorporate our services into existing platforms. An encouraging market dynamic is benefiting our growth as well.

Regarding credit, we have taken a cautious approach. Rushing through credit processes is not advisable. We aim to provide brands with greater control over their value propositions, marketing, and onboarding, creating a truly integrated experience. This approach targets digital-first businesses seeking innovative models, and we’re beginning to see positive reception, especially among those accustomed to traditional co-branding methodologies. For example, the airline we recently secured had an existing credit card in its home market, enabling a stronger understanding of traditional methods while seeking something more engaging for its U.S. operations, which contributed to our success in winning their business.

Operator

Our next question comes from Timothy Chiodo with UBS. Please proceed…

Marqeta’s CFO Discusses Pipeline Opportunities and Profitability Outlook

Timothy Chiodo — Analyst

Thank you for taking my question. Mike, on a related note regarding embedded finance, I noticed one of your competitors recently secured a significant contract that was publicly shared during their earnings call, along with a press release. They mentioned a pipeline of similar opportunities, although it’s unclear if they meant deals of comparable size. What is Marqeta’s stance on potential larger embedded finance deals in your pipeline? Do you believe you have the components needed to secure these RFPs, such as money movement, issuer processing, and program management?

Mike Milotich — Chief Financial Officer

Thank you, Tim. Yes, we are indeed engaged with several large companies interested in embedded finance solutions. Companies in this sector typically seek integration through APIs, making it easier to connect to their existing systems. They demand full solution support, including credit, debit, and in some cases, buy now pay later (BNPL) options. Additionally, full program management is essential; these firms prefer having less exposure to the complexities of regulatory compliance.

Moreover, many of these customers are already global entities, which means they don’t consider payments with a narrow focus. We understand that each market has its own nuances, and our offering should accommodate global payment needs effectively. We believe our competitive advantage lies in being a fully modern platform capable of scaling operations. We have established relationships with numerous large clients, which reinforces stability in meeting their success needs.

Marqeta provides both consumer and commercial credit and debit services, along with comprehensive program management in various markets. This capability is unique and distinguishes us as we anticipate growth in embedded finance agreements moving forward.

Timothy Chiodo — Analyst

Thank you, Mike. I appreciate your insights.

Operator

Our next question comes from Ramsey El-Assal with Barclays. Please proceed with your question.

Unknown speaker — Barclays — Analyst

Thanks. This is John standing in for Ramsey. I have a clarification question regarding your guidance. Is it correct that your quarterly estimates assume the acquisition of TransactPay will close in Q3?

Mike Milotich — Chief Financial Officer

That is correct. We have submitted the necessary applications for the license transfer, and it is now in the hands of regulators. For planning purposes, we estimate a close around July 1, give or take a month or two.

Unknown speaker — Barclays — Analyst

Got it. Thank you. You also noted your expectation for GAAP profitability by the end of 2026. Can you elaborate on the steps or trajectory to reach this goal?

Mike Milotich — Chief Financial Officer

Certainly. To clarify, we expect to achieve GAAP profitability on a quarterly basis by 2026, though not for the full year. We anticipate that our gross profit will grow at a quicker pace than our expenses. This outlook is based on several factors: embedded finance momentum is increasing, and our current customers are expanding their business with us.

We have a distinctive skill set that makes us an appealing partner, and our operational scale will enable us to improve efficiency. Given that we operate on a mostly fixed cost structure, we are strategically automating and simplifying processes. This will keep the gap between gross profit growth and expense growth favorable. Over the coming quarters, this trajectory should help us achieve the targeted GAAP profitability.

Operator

Next, we have Darrin Peller from Wolfe Research. Please proceed.

Darrin Peller — Analyst

Hi, everyone. I’m glad to see operations returning to form. I want to revisit last quarter; there was a nine-point reduction in your forecasts. Now, however, you’re looking at mid-teens. Can you clarify what underpins this year’s guidance, especially regarding delayed customers and changes in models from last quarter’s updates? Additionally, regarding the recently launched programs that had been delayed, was this more due to internal factors or lifted regulatory challenges?

Mike Milotich — Chief Financial Officer

Thank you, Darrin. Typically, our business does not experience significant changes in a short timeframe unless correlated with new business launches. We maintain regular communication with existing customers, so we are well-informed about their growth expectations. The projected growth for 2025 is slightly lower than our Q4 exit, influenced by specific events that occurred in Q4 that inflated our growth rate. However, we remain optimistic about future growth, particularly new programs set to launch in 2024 and 2025, which we expect will yield over $40 million in revenue—roughly five points to our 2025 revenue growth. While this is below our initial goals, it still represents a positive trajectory.

Marqeta Discusses Growth, Renewals, and International Expansion

The growth trajectory for Marqeta is showing promise, despite some challenges that the company faces in reaching the high growth rates achieved in the past. The CFO, Mike Milotich, highlighted several key elements impacting their growth strategy.

Impact of Renewals on Growth

Darren, your point about renewals is crucial. Renewals are a constant factor each year, and as discussed previously, Marqeta successfully renewed 80% of its Total Payment Volume (TPV) during 2022 and 2023. However, two top 10 customers are renewing in 2025. These significant customers are experiencing rapid growth, with each of their volumes more than doubling since the last contract was signed. This factor influences our growth projections.

It’s anticipated that these renewals will affect our gross profit growth by approximately two percentage points annually. Given that they will happen in the second half of the fiscal year, we predict a more pronounced impact—a reduction of about four points in revenue for each of those quarters. Even so, our existing customers are still driving strong growth, contributing five percentage points to revenue growth from new business.

Sector Growth Drivers in Neobanking

Turning to our sector performance, the neobanking space is our top growth area. An increasing number of companies aim to bank their users, targeting consumers and small to medium-sized businesses. They’re looking to provide Direct Deposit Accounts (DDA) and associated spending tools, including lending options.

The Buy Now, Pay Later (BNPL) and lending sectors continue to show considerable activity. Innovation persists in the BNPL market, with companies issuing cards to enhance their service offerings. Wallet providers are also integrating these services, which broadens the distribution channels for businesses. At Marqeta, we are developing our solution, Marqeta Flex, to empower BNPL providers even further.

Additionally, small business lending is thriving as certain customers manage to leverage platform capabilities effectively, driving substantial growth. Lastly, we notice rapid adoption in expense management. Modern corporate card and accounts payable automation solutions are gaining significant market share, supported by platforms such as ours. Despite the competition, the growth rate remains robust, outpacing the overall market.

International Momentum and Growth in Europe

Our international performance, particularly in Europe, shows notable strength. Andrew, you asked about this; it’s an area we have naturally emphasized in this quarter’s disclosures. Two primary factors drive this growth.

First, we have enhanced the capabilities we offer outside the U.S., especially in Canada and Europe. Improvements in service quality and reliability have made banks in these regions strong partners in addressing customer needs. Our value proposition has improved significantly over the last two years.

Secondly, the convergence of fintech and embedded finance plays a vital role. Many fintech customers who integrated our platform years ago are expanding their operations into new markets. Our platform facilitates this expansion seamlessly, nurturing customer growth in these regions.

Notably, TPV growth for our non-U.S. business exceeded 100% this quarter, with Europe accounting for a large portion of that success.

CEO Search and Future Leadership

Regarding the search for a new CEO, the board is actively engaged in succession planning. They aim for a smooth transition that maintains continuity with the current executive team and all Marqeta employees. This careful approach allows for a deliberate search process to find a suitable new leader.

The desired qualities in the next CEO include innovative thinking, a background in technology, and a sound understanding of the payments ecosystem. Importantly, the board seeks an individual capable of driving sustainable, profitable growth in alignment with Marqeta’s goal of being the preferred partner in embedded finance and fintech.

With these strategic elements in place, Marqeta is poised to navigate its future successfully while addressing existing challenges and continuing to capitalize on growth opportunities in both domestic and international markets.

Marqeta’s CFO Discusses Growth Opportunities and Risks in Earnings Call

“I think that’s the kind of candidate that the board will be looking for. But they’re going to have a thorough process. So, I’m not going to jump ahead of it here. We’ll let that play out.”

Andrew Bauch — Analyst

Understood. Thank you, Mike.

Mike Milotich — Chief Financial Officer

Yep.

Operator

Our next question comes from Sanjay Sakhrani with KBW. Please proceed with your question.

Financial Improvements and Potential Risks

Sanjay Sakhrani — Analyst

Thank you. It’s encouraging to hear about improvements in launch timelines and new wins. However, looking ahead to the year, Mike, what should we be aware of regarding potential risks? Clearly, there are many positive developments following earlier disappointments, but what landmines might we encounter?

Mike Milotich — Chief Financial Officer

Thanks for your question, Sanjay. The macroeconomic environment is always a consideration since our success relies heavily on consumer spending. Additionally, we anticipate about five points of revenue growth from new programs launching in either 2024 or 2025.

Once Marqeta and our banking partner fulfill their launch requirements, the responsibility shifts to our customers to launch the program. This involves onboarding customers, executing marketing strategies, and driving engagement. While we support and consult, the pace largely depends on them. Delays in their execution can slow down the expected revenue growth.

For instance, although we’ve improved our delivery timelines and are ready to launch all delayed programs, three programs remain unlaunched due to ongoing customer issues. This highlights an area where we have limited control over launch timing and business ramp-up speed. We maintain close relationships with our customers, aligning on projections based on historical data, yet these variables can be unpredictable.

Nevertheless, we believe these challenges are outweighed by the advantages we have. Our growing client base and broadening range of services position us well. For example, our real-time decisioning risk service revenue has more than doubled in 2024 compared to 2023, and we see growing interest in our embedded finance solutions. Our capability to offer flexible credentials—integrating debit, BNPL, and revolving credit—is particularly appealing to market prospects.

American Express Partnership Insights

Sanjay Sakhrani — Analyst

Great. Regarding the addition of American Express, could you clarify the potential opportunities this brings? Will we see better terms, or is there a chance to enhance sales to existing customers?

Mike Milotich — Chief Financial Officer

Certainly. There are several avenues for growth here. American Express is well-regarded for its credit capabilities, especially in B2B lending and loyalty cards.

They are actively engaging with customers contemplating brand decisions, and if those customers seek a modern, flexible platform, Marqeta will be positioned to meet that need by the end of 2025. We believe combining Amex’s credit expertise with our innovative capabilities will enhance our sales efforts.

Furthermore, American Express aims to bolster its debit business, a smaller segment for them. With Marqeta’s extensive experience in that area, we can significantly contribute to their growth. Overall, we view this partnership as mutually beneficial, completing our offerings for customers since Amex was the last major network we had yet to include.

Accelerated Wage Access Initiative Update

Sanjay Sakhrani — Analyst

Thank you, Mike. Good luck.

Mike Milotich — Chief Financial Officer

Thanks, Sanjay.

Operator

Our next question comes from Cris Kennedy with William Blair. Please proceed with your question.

Cris Kennedy — Analyst

Good afternoon. Thanks for taking my question. Could you provide an update on the accelerated wage access initiative and its market potential?

Mike Milotich — Chief Financial Officer

Yes, certainly. Our accelerated wage access program continues to progress, with a few notable programs currently live. We’ve discussed the two major initiatives frequently, and we also have several labor marketplaces that have recently launched.

This segment is growing rapidly. We’ve focused on enhancing our value proposition for customers. Although we offer a unique solution that requires customers to take on certain responsibilities, we’re working to simplify our offerings further.

This year, we announced a partnership with Rain to enrich our capabilities, ensuring that our solution becomes more appealing to a broader audience of potential clients.

Cris Kennedy — Analyst

Thank you for that insight. Additionally, what are your thoughts on the regulatory environment surrounding accelerated wage access?

Mike Milotich — Chief Financial Officer

From our perspective, the solution we provide is designed to minimize regulatory scrutiny. Our approach avoids the pitfalls of offering loans, which many traditional EWA providers do. Instead, we empower our clients by letting them access funds they’ve already earned, providing those sooner.

This fundamental shift in our offering alleviates some concerns about sustainability that are prevalent with existing solutions in the market.

Operator

We have reached the end of our question-and-answer session, thus concluding today’s conference. [Operator signoff]

Duration: 0 minutes

Call Participants

Stacey Finerman — Vice President, Investor Relations

Mike Milotich — Chief Financial Officer

Tien-Tsin Huang — JPMorgan Chase and Company — Analyst

Timothy Chiodo — Analyst

Tim Chiodo — Analyst

Unknown speaker — Barclays — Analyst

Darrin Peller — Analyst

Andrew Bauch — Analyst

Sanjay Sakhrani — Analyst

Cris Kennedy — Analyst

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