Mogo Finance Technology Inc. Reports Q4 Earnings as Bitcoin Plummets
Mogo Finance Technology Inc. (TSX:MOGO) is a financial technology company that offers credit solutions to its online client base. Mogo stock was down 1.27% in early afternoon trading on March 8 and has dropped 26.2% in 2018 thus far. The company released its 2017 fourth quarter and full-year results on March 6.
For the full-year Mogo reported total revenue of $48.7 million which represented a 2% drop from 2016. However, subscription and fee based revenue rose 56% year over year but was offset by a decline in fees from short-term credit products. Gross profit dollar rose 7% and the company boasted a higher gross margin of 67% compared to 62% in 2016. Adjusted EBITDA soared to $2.5 million compared to $0.1 million in 2016.
In 2017 Mogo formed a new subsidiary called Mogo Blockchain Tedchnology Inc. This business will serve as Mogo’s blockchain operations and the company plans to host bitcoin mining on its platforms. Ethereum co-founder Anthony Di Iorio also joined Mogo as a special advisor at year’s end.
The news has not been so good for bitcoin and cryptocurrencies since Mogo released its earnings. Bitcoin plummeted below the $9,500 mark after the U.S. Securities and Exchange Commission (SEC) warned that online trading platforms should register with the agency. Japan has also clamped down on cryptocurrency exchanges in its country, ordering two to stop operations on March 8. Germany and France are also expected to introduce proposals to crackdown on cryptocurrencies when the G20 convenes next week, which could also push down prices.
Recent results are very positive for Mogo, but its foray into blockchain and cryptocurrencies may be ill-timed as 2018 is setting up to be the year the international community moves to stifle the booming market.