Payment technology company Marqeta (NASDAQ: MQ) met Wall Street’s revenue expectations in Q3 2026, with sales up 7.9% year on year to $176.2 million. On the other hand, next quarter’s revenue guidance of $179 million was less impressive, coming in 4.1% below analysts’ estimates. Its GAAP profit of $1.09 per share was significantly above analysts’ consensus estimates.

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StockStory’s take

Marqeta’s third quarter was characterized by a mixed market response, as revenue growth met Wall Street’s expectations but management faced questions about the sustainability of recent margin improvements. CEO Mike Milotich attributed the quarter’s results to strong transaction processing volume (TPV) growth and deeper partnerships, including a key portfolio migration for Square’s credit card onto Marqeta’s platform. However, management noted that gross profit growth slowed compared to previous quarters, due to discrete items discussed earlier in the year and a deceleration in new issuance volumes with long-term fintech partners. CFO Patti Kangwankij emphasized that “non-Block TPV continued to grow more than twice as fast as Block TPV,” highlighting diversification efforts.

Looking ahead, Marqeta’s cautious revenue guidance for the next quarter reflects changes in how large customers structure their banking and network relationships, which impacts reported revenue but not gross profit. Management expects little to no new issuance from major programs such as Cash App through year-end, creating a drag on near-term growth. Kangwankij explained that the flexibility Marqeta offers its customers—allowing them to contract directly with banks and networks—results in lower reported revenue while gross profit remains stable, emphasizing, “This is probably another good example of why we use gross profit as the key measure of performance.” The company remains focused on platform enhancements and expanding its use cases, but acknowledged some headwinds from the evolving mix of customers and programs.

Key insights from management’s remarks

Management credited third quarter results to successful portfolio migrations, product suite enhancements, and continued expansion with both longstanding and new customers across fintech and embedded finance segments.

• Square credit card migration: Marqeta successfully migrated Square’s credit card portfolio onto its platform, consolidating both debit and credit products for Square sellers and highlighting the platform’s ability to seamlessly transition card programs across networks and banks without disrupting end-user experience.
• Expansion in embedded finance: Beyond fintech, Marqeta increased penetration among embedded finance customers, supporting new offerings such as Google Wallet for Kids. The platform’s spend controls and tokenization features enabled Google to provide digital-first products for families, expanding Marqeta’s reach beyond traditional financial institutions.
• European market progress: Marqeta enabled Italian fintech Satispay to launch its consumer debit card, using Marqeta’s infrastructure to support international in-store and online payments. Management noted this win as proof of its ability to serve diverse geographies and customer types.
• Product suite enhancements: The company launched new features such as stablecoin-backed card solutions in partnership with Coinbase, and commercial payment enhancements like straight-through processing for supplier payments. These updates are designed to attract a broader set of enterprise customers seeking integrated payment solutions.
• Gross profit focus amid revenue shifts: Management emphasized a shift in how some large customers structure their programs—contracting directly with banks and networks—which reduces Marqeta’s reported revenue but does not impact gross profit. This change underscores the company’s message that gross profit is the most relevant measure of its economic performance.

Drivers of future performance

Marqeta’s outlook is shaped by evolving customer arrangements, ongoing investment in platform capabilities, and anticipated slower growth in key programs.

• Customer program structuring: Large customers are increasingly choosing to contract directly with banks and networks, reducing Marqeta’s reported revenue but leaving gross profit unchanged. Management believes this flexibility is a competitive advantage, but it introduces volatility in headline revenue growth.
• Slower new issuance from Cash App: The company expects little to no new card issuance from Cash App through the end of the year, which is likely to weigh on near-term growth. Management highlighted that while the existing user base remains engaged, the pace of new card activations has slowed.
• Continued investment in platform: Despite slower top-line growth, Marqeta plans to invest in product development and operational efficiency, aiming for further margin expansion. CFO Patti Kangwankij noted that operating expenses have remained flat and are expected to rise modestly, with scale allowing for continued EBITDA margin improvements.

Catalysts in upcoming quarters

In the coming quarters, the StockStory team will be watching (1) how Marqeta’s migration capabilities continue to attract new enterprise customers and drive portfolio wins, (2) whether slower new issuance with major partners like Cash App rebounds or remains a headwind, and (3) the impact of platform enhancements—such as stablecoin-backed cards and straight-through processing—on customer adoption across geographies. Shifts in how customers structure banking relationships will also be a key factor to monitor.

Marqeta currently trades at $17.09, down from $17.80 just before the earnings. At this price, is it a buy or sell? Find out in our full research report (it’s free).

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