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Payfare share price craters after DoorDash contract blow

Shares in Payfare plummeted by more than 75% after the Canadian earned wage access firm initiated a strategic review in response to losing its biggest client, DoorDash.

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Payfare share price craters after DoorDash contract blow

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This content has been selected, created and edited by the Finextra editorial team based upon its relevance and interest to our community.

Last week, Payfare revealed that food delivery app DoorDash would not be renewing its deal for the DasherDirect card programme when it expires early next year.

The contract has been a "substantial proportion" of Payfare's total revenue and its loss prompted the Toronto-based outfit to withdraw its previously issued 2024 financial guidance for revenue and earnings.

The news sent Payfare's share price tumbling from more than US$6 dollars a share to around US$1.50.

In response, the company's board has brought in outside legal and financial advisors for a "comprehensive and thorough strategic review process to explore and evaluate a broad range of potential options for the Company to enhance value".

The firm points to long-term renewals with Uber and Lyft this year, and the fact it has over $100 million in cash, cash equivalents, and guaranteed investment certificates.

However, the review will strategic partnerships, investments, accretive acquisitions, a potential sale, merger or other business combination.

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