Hi I believe the market has not understood $SEZL.
There are 5 reasons I do not agree with the consensus.
**Reason #1: Actual Quality of Earnings is an issue!**
Total Revenue was $135.5m. Consumer-paid fees were 45% of revenue: consumer fees inside transaction income ($38.1m, 28.1%) + late payment fees ($23.1m, 17.0%) – before counting the subscription ($33.2m, 24.5%), which itself does not make sense for the consumer (Reason #3). Merchant + partner income was only $27.6m (20.4%).
**Reason #2: Fees are too punitive and prying on unaware consumer**
The Late Saver Fee ($1.99) is charged when Sezzle collects a scheduled payment via the card on file instead of ACH – effectively a penalty for declining to share bank credentials.
**Reactivation Fee ($10/order)**: Charged to every other user after a missed payment. Not applicable in Quebec.
o **Rescheduling Fee (up to $7.50 US / $5.00 Canada)**: Charged to every other user who delays a payment by up to two weeks. Not applicable in Quebec.
o **Liability for payment-method fees**: Outside Quebec, the user is liable for any fees or charges their bank or card issuer imposes when a Sezzle pull fails or bounces
**Reason #3: Why the Subscription Does Not Make Sense!**
o Sezzle Premium at $13.99 and Sezzle Anywhere at $19.99
o At FY2025 (Dec 31, 2025): Active Consumers 3,049K, MODS (monthly On-Demand users + Subscribers) 918K, rest are lapsed-monthly actives (\~2.13m). The split is now disclosed: at March 31, 2026 there were \~0.7m Active Subscribers (+48.4% YoY) and \~0.2m monthly On-Demand users.
o So the period-end split is roughly \~680–700K subscribers and \~200–240K On-Demand users.
o Management’s actual disclosure (3Q25 deck) is that subscribers place 10x more ORDERS than non-subscribers
o Solving Q1’26 monthly GMV (\~$370m) across \~0.7m subscribers, \~0.2m On-Demand and \~2.2m other actives, with subscriber order frequency at 10x non-subscribers and similar ticket sizes, puts subscriber GMV at roughly $350–$450/month (\~$370 in the base case below). Against an average \~$15/month fee, **the subscription alone costs \~4% of monthly purchase volume.**
**That is just the subscription. On top of it, consumer fees + late fees ran \~5.3% of GMV in FY2025 ($131.9m + $74.0m on $3.9B of GMV) for an average user. Basically, a user pays \~10%/month on average.**
**Reason #4: They seem to make the earnings via under-provisioning vs history**
Allowance-to-trailing-12-month GMV fell from \~1.0% at YE2024 ($26.1m on \~$2.5B) to \~0.47% ($19.8m on \~$4.2B).
**Reason #5: Their actual business was competed away by Affirm/Klarna hence they are pivoting!**
FY2025 merchant + partner income was $102.2m on $3.9B of GMV (\~2.6% including partner/interchange income); Merchant monetization has roughly halved since 2020 while consumer monetization exploded.
Views are own. Do your own reasearch. I do hold a short position in the stock.