Last week, Stripe Payments International Holdings, the Dublin, Ireland-based international subsidiary of payments heavyweight Stripe, published its annual financial results for 2024.
A mandatory requirement for Ireland-based companies, the annual figures provide the only view into Stripe’s financial performance outside of the annual letter penned by company’s co-founders, CEO Patrick Collison and President John Collison. But while that letter provides an operational narrative and an annual update on the money moved through Stripe each year, the International results provide hard figures on revenue, profitability and expenditure for a subsidiary that accounts for around a quarter of the company’s global employees.
However, this year, those numbers included something not seen at Stripe International for half a decade: profit. Alongside revenue growth of 34% to $5.1bn for 2024, the subsidiary also reported $102m in pre-tax profit – a significant improvement on the previous year’s losses of $1.2bn.
This is helping to cement Stripe’s position as an increasingly strong candidate for an IPO after years of anticipation from investors and industry commentators alike. Having raised $9.4bn since its founding 15 years ago, from players including Andreessen Horowitz, Sequoia Capital and Tiger Global, Stripe has faced pressure to make the move to the public markets for some time. But it may be in a stronger position to do so now than has been the case in some time.
Stripe’s shift to profit is a strong sign for an IPO
This shift to profit may be a single year in a subsidiary, but it echoes statements in the Collisons’ annual letter, where they reported that the company “was profitable in 2024” and that they expected it “to be so in 2025 and beyond”.
Further analysis of the Stripe International numbers shows a strong focus on increasing operational efficiencies, with costs per employee dropping and costs being kept broadly flat. This all speaks to a greater focus on the type of financial maturity that might be expected from a company readying itself for an IPO – and is likely to please investors who are looking for a company of Stripe’s reach and renown to have a strong base on which to build.
Notably, the fact that the company has opted to make this move to profitability now also suggests an intention to refine its financials to a more market-ready position. In the past, it is very likely that the company could have switched to profitability earlier at the expense of R&D development, and the fact it has made this choice now speaks not only to its general maturity as a company, but also to a sense that the end of its time as a private company may be in sight.
Lessons from Circle: Stablecoins and market demand
Beyond the numbers, there are also signs that the market is in a very different place now than it was even at the beginning of the year. Circle’s blockbuster IPO surprised many in the industry and at the time of writing, around three months on, the company is trading roughly 26% up on its market debut.
This speaks to a renewed market enthusiasm for fintechs such as Stripe, and it is quite likely that the payments giant could see an even stronger market debut if it makes its move in similarly favorable conditions. While Circle’s domain is exclusively stablecoins, Stripe’s is the whole internet, with a payment volume that it says is roughly equivalent to around 1.3% of global GDP.
That’s not to say that Stripe’s stablecoin presence won’t also be a help to it. Having bought stablecoin infrastructure player Bridge at the start of the year for $1.1bn, the company has cemented itself as a key player in the fast-emerging market, as well as in the fiat-led payments space – and that is likely to make it even more appealing to investors looking for companies that can proxy for the wider stablecoin market.
Can Stripe reach a $100bn valuation?
Stripe’s most recent valuation came in February of this year, when the company was priced at $91.5bn. However, its highest valuation was in 2021, when the company saw its value reach $95bn, although this dropped to $74bn the following year amid a wider post-pandemic slump.
The most recent valuation came as part of an employee share sale, a move widely considered to be a sign that an IPO was not imminent. However, that valuation and its reported improvements in fiscal maturity since speak to a company that is improving its offering to the market – and Circle’s IPO is likely to have created a new benchmark for valuations that Stripe compares favourably to.
$100bn may therefore not only be in reach for the company, but a crucial point its leadership is looking to reach for in order to pull the trigger on its long-awaited IPO. And if that is the case, it may well yet see that within the year.
While 2026 is by no means a guarantee for a Stripe IPO, its current moves make it more likely than ever – assuming the current market conditions hold.