Revolut Reveals First Annual Profit In Long-delayed Report

Source: PitchBook, Leah Hodgson
Photo: Courtesy of Revolut

Revolut has recorded its first-ever annual profit in a delayed report for 2021, revealing that crypto trading helped to boost the VC-backed challenger bank’s revenues alongside more users.

In its 2021 annual report, the London-based company reported a net profit of £26.3 million (around $31.7 million) compared with the previous year’s loss of £223.6 million. Revenue almost doubled to £636.2 million from £219.9 million in 2020.

Information for 2022 has not yet been released.

Revolut cited an increase in weekly active users, average spend and paid subscriptions as reasons for its strong financial performance.

“Our profitability in 2021 was despite the economy suffering a significant prolonged shock from global lockdowns, continued travel bans and COVID-19 effects,” CEO Nik Storonsky said. “But at the same time, the accelerated shift to digital services and remote working boosted our number of customers and the amount that they used our app.”

The company also benefited from 2021’s record year for crypto trading, during which the market surpassed $3 trillion in value with currencies including Bitcoin and Ether reaching all-time highs.

Revolut’s foreign exchange and wealth division, which houses its crypto trading unit, accounted for more than half of its total 2021 revenues with £348.7 million—a 760.2% increase from 2020. With the downturn in the crypto market last year, Revolut is unlikely to have seen similar levels of trading in 2022.

As well as reporting its first annual profit, 2021 also saw Revolut raise substantial amounts of venture funding. The company secured an $800 million Series E in July of that year led by SoftBank’s Vision Fund 2 and Tiger Global. The round gave it a valuation of $33 billion—six times larger than its previous price tag of $5.5 billion achieved in 2020.

Revolut’s Series E took place during the peak for global venture investments in the fintech space, which have since fallen. Capital raised in 2021 reached a record $121.4 billion, according to PitchBook data, but dropped 30.5% to $84.4 billion last year. So far in 2023, $6.6 billion has been invested.

There are no signs that Revolut is in the market for additional funding in the near future, despite having not raised funds in over 18 months.

The company is expected to release its 2022 figures later this year, but it stated in an update that revenues grew around 30% to more than £850 million—a smaller rise than the 189.3% increase seen between 2020 and 2021. Revolut has not commented on whether or not it achieved profitability in 2022.

The release of Revolut’s annual figures follows fellow European fintech company Klarna’s 2022 report. Klarna posted its largest annual loss ever, but the report revealed shrinking losses toward the end of the year.

https://pitchbook.com/news/articles/revolut-first-annual-profit-2021