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Can Sezzle's On-Demand Continue to Fuel Its Growth Engine?
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Key Takeaways
Sezzle's MODS reached 887K (up 34.8% y/y); active subscribers rose 48.4% despite a seasonal dip.
SEZL On-Demand drove Q1'26 GMV 37.3% to $1.1B; purchase frequency hit a record 7.1X.
SEZL marketing spend doubled; the operating margin rose 3.3 points and net income margin gained 3.4 points.
Sezzle’s (SEZL - Free Report) strategy to launch On-Demand was grounded on its ability to provide users with a flexible option to Pay-in-4 wherever Visa is accepted. This product eliminated barriers to its direct merchant partnerships, pivoting to a buy-now-pay-later solution available for its customers anywhere.
As of March 31, 2026, Monthly On-Demand & Subscribers (MODS) totaled 887,000, a 34.8% year-over-year jump. While active subscribers increased 48.4% year over year, there was a sequential dip in Monthly On-Demand users due to seasonal moderation, a common factor following the fourth-quarter holiday shopping period.
While seasonality risk lingers, On-Demand’s popularity over the years drove gross merchandise volume (GMV) by 37.3% year over year to $1.1 billion in the first quarter of 2026. Average purchase frequency reached a quarterly record of 7.1X, up from 6.1X in the year-ago quarter. These combined forces fueled year-over-year top-line growth of 29.2%.
While top-line growth was noteworthy, questions surrounding scalability have heightened. In the first quarter of 2026, marketing expenses surged more than 2 times in support of subscriber acquisition, retention and engagement.
Despite this upsurge, the operating margin expanded 3.3 percentage points and net income widened 3.4 percentage points. It demonstrates the company’s ability to optimize costs such that it aids the On-Demand growth trajectory, fueling top-line growth in the long run.
Last but not least, MODS carry a highly repetitive and recurring nature of interaction, resulting in a strong lifetime value. Therefore, it is evident that Sezzle’s growth trajectory is vested in its ability to attract and retain more On-Demand users.
SEZL’s Price Performance, Valuation & Estimates
The stock has skyrocketed 91.8% in six months against the industry’s 11.2% dip and compared with the 12.4% rise in the Zacks S&P 500 Composite. SEZL has outperformed its industry peers, Green Dot’s (GDOT - Free Report) 12% growth and OppFi’s (OPFI - Free Report) 3.9% decline.
6-Month Share Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, SEZL trades at a forward price-to-earnings ratio of 18.3, above Green Dot’s 8, OppFi’s 4.94 and the industry’s 16.26.
P/E F12M
Image Source: Zacks Investment Research
Sezzle has a Value Score of D. OppFi and Green Dot carry a Value Score of A and B, respectively.
The Zacks Consensus Estimate for Sezzle’s 2026 and 2027 earnings has moved up 8.5% and 8.6% in the past 60 days, respectively.
View the Zacks #1 Rank List
Image: Bigstock
Can Sezzle's On-Demand Continue to Fuel Its Growth Engine?
Key Takeaways
Sezzle’s (SEZL - Free Report) strategy to launch On-Demand was grounded on its ability to provide users with a flexible option to Pay-in-4 wherever Visa is accepted. This product eliminated barriers to its direct merchant partnerships, pivoting to a buy-now-pay-later solution available for its customers anywhere.
As of March 31, 2026, Monthly On-Demand & Subscribers (MODS) totaled 887,000, a 34.8% year-over-year jump. While active subscribers increased 48.4% year over year, there was a sequential dip in Monthly On-Demand users due to seasonal moderation, a common factor following the fourth-quarter holiday shopping period.
While seasonality risk lingers, On-Demand’s popularity over the years drove gross merchandise volume (GMV) by 37.3% year over year to $1.1 billion in the first quarter of 2026. Average purchase frequency reached a quarterly record of 7.1X, up from 6.1X in the year-ago quarter. These combined forces fueled year-over-year top-line growth of 29.2%.
While top-line growth was noteworthy, questions surrounding scalability have heightened. In the first quarter of 2026, marketing expenses surged more than 2 times in support of subscriber acquisition, retention and engagement.
Despite this upsurge, the operating margin expanded 3.3 percentage points and net income widened 3.4 percentage points. It demonstrates the company’s ability to optimize costs such that it aids the On-Demand growth trajectory, fueling top-line growth in the long run.
Last but not least, MODS carry a highly repetitive and recurring nature of interaction, resulting in a strong lifetime value. Therefore, it is evident that Sezzle’s growth trajectory is vested in its ability to attract and retain more On-Demand users.
SEZL’s Price Performance, Valuation & Estimates
The stock has skyrocketed 91.8% in six months against the industry’s 11.2% dip and compared with the 12.4% rise in the Zacks S&P 500 Composite. SEZL has outperformed its industry peers, Green Dot’s (GDOT - Free Report) 12% growth and OppFi’s (OPFI - Free Report) 3.9% decline.
6-Month Share Price Performance
From a valuation standpoint, SEZL trades at a forward price-to-earnings ratio of 18.3, above Green Dot’s 8, OppFi’s 4.94 and the industry’s 16.26.
P/E F12M
Sezzle has a Value Score of D. OppFi and Green Dot carry a Value Score of A and B, respectively.
The Zacks Consensus Estimate for Sezzle’s 2026 and 2027 earnings has moved up 8.5% and 8.6% in the past 60 days, respectively.
SEZL currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.