Swissquote has revised its full-year profit and revenue forecasts downwards following a weak first half: revenues from cryptocurrency operations have plunged sharply, and Swissquote Group shares have declined after the publication of the new outlook.
Main Points
Metric — Value — Change (%)
Net crypto income — 14.6 million Swiss francs in the first half — -66.2%
Cryptocurrency trading volume — 2.58 billion Swiss francs, or approximately 3.2 billion dollars — -63.5%
Swissquote Group shares — SQN stock fell after the announcement — -14%
Cryptocurrency Revenue Sharply Declines
Swiss banking group Swissquote Group, whose stock trades under the ticker SQN, has lowered its full-year forecasts after weak performance in its cryptocurrency segment. Net income from cryptocurrencies for the first six months fell by 66.2% to 14.6 million Swiss francs, or approximately 18 million dollars.
Trading activity also dropped significantly. The volume of cryptocurrency transactions for the Gland-based fintech company decreased by 63.5% to 2.58 billion Swiss francs. Against this backdrop, Swissquote lowered its full-year net revenue forecast by approximately 30 million francs, to 730 million francs.
What Influenced the Forecast Revision
The company attributed the deterioration in expectations to falling prices for most digital assets. Several factors most strongly impacted Swissquote's performance in this period:
- Cryptocurrency market dynamics: The decline in Bitcoin, Ethereum, and the CoinDesk 20 index hit trading activity and crypto revenues.
- Own cryptocurrency holdings: A loss of 5.3 million Swiss francs on these added pressure to the results.
- Client activity: The reduction in cryptocurrency trading volume directly lowered revenues from this segment.
- Competition and regulation: For the online broker, these factors are important because they affect commissions, compliance costs, and growth rates.
In the six months ending June 30th, Bitcoin lost 33%. Ethereum, the second-largest cryptocurrency by market cap, fell 47%, and the CoinDesk 20 index declined 40%.
The updated outlook now accounts for a weaker-than-expected situation in the cryptocurrency market.
Why the Overall Position Remained More Resilient
Despite the collapse of the cryptocurrency segment, other areas helped cushion the blow to financial results:
- Growth outside of cryptocurrency trading supported the overall revenue level.
- An increase in net interest income helped limit the decline in profit.
Swissquote's client assets grew by nearly 20% to reach 96.3 billion Swiss francs. This was an important detail for investors, although the market still reacted harshly: the stock as a security lost 14% after the announcement. Against the backdrop of the revised expectations, investments in SQN came under pressure.
What Else Investors Should Watch
For evaluating SQN, it is useful to compare news flow with fundamental indicators and official reporting.
- Swissquote's financial statements and presentations help verify revenue, profit, and client asset dynamics.
- Analytical platforms and specialized media provide reviews of news, multiples, and changes in target prices.
- Key metrics for analysis: P/E, P/B, ROE, profit margin, debt load, EPS, and dividend yield.
- Arguments in favor of SQN: Growth in client assets, support from net interest income, and business outside of cryptocurrencies.
- Risks for SQN: Weak cryptocurrency revenue, decline in trading volume, and revision of annual guidance.
