Riskified Ltd.'s (NYSE:RSKD) Profit Outlook

With the business potentially at an important milestone, we thought we'd take a closer look at Riskified Ltd.'s (NYSE:RSKD) future prospects. Riskified Ltd., together with its subsidiaries, develops and offers an e-commerce risk intelligent platform that allows online merchants to create trusted relationships with consumers in the United States, Europe, the Middle East, Africa, the Asia-Pacific, and the Americas. The US$850m market-cap company posted a loss in its most recent financial year of US$35m and a latest trailing-twelve-month loss of US$37m leading to an even wider gap between loss and breakeven. The most pressing concern for investors is Riskified's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

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Consensus from 8 of the American Software analysts is that Riskified is on the verge of breakeven. They anticipate the company to incur a final loss in 2026, before generating positive profits of US$21m in 2027. Therefore, the company is expected to breakeven roughly 2 years from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 81% is expected, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

We're not going to go through company-specific developments for Riskified given that this is a high-level summary, though, bear in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Check out our latest analysis for Riskified

One thing we’d like to point out is that Riskified has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which usually has a high level of debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.

Next Steps:

There are too many aspects of Riskified to cover in one brief article, but the key fundamentals for the company can all be found in one place – Riskified's company page on Simply Wall St. We've also put together a list of essential aspects you should further research:

1. Valuation: What is Riskified worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Riskified is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Riskified’s board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.