The Afterpay (ASX: APT) share price is up more than 2% after announcing a US update to the market.
What is Afterpay?
Afterpay Ltd is the owner of the popular “buy now, pay later” app. Afterpay has over 5 million registered users worldwide, making it one of Australia’s true technology success stories. Afterpay is trying to emulate its outstanding success in Australia by expanding its reach into the UK, using the ‘Clearpay’ brand name, and into the USA, where it has signed major social influencers to endorse its service.
Afterpay’s US update
Afterpay announced today that its customers can now use Apple Pay to make purchases through Afterpay in physical stores and online.
From this month, some retail stores in the US will now offer Afterpay. Some of the first stores to offer this will be Forever21, Fresh, Skechers and Solstice Sunglasses. By using Apple Pay with existing payment terminals, there are no merchant integration costs associated with accepting Afterpay.
Customers in Australia will be able to use Apple Pay to make retail store purchases via the Afterpay app in the coming months.
Afterpay also announced that shoppers can also utilise ‘buy now, pay later’ with Google Pay as well.
Afterpay co-founder Nick Molnar said: “As we enter the second half of the year and retail re-emerges across the world, it’s critical we help our partners drive business growth, both online and offline. As a proven business solution for driving incremental sales and new customer growth, we are thrilled to introduce our new omni-channel solution to US retailers as they begin to open their doors and bring shoppers back to their physical stores.”
Summary
Afterpay continues to make the right moves to increase its market penetration and ease of access for consumers. You want to make it as easy as possible for your customers as possible to transact with you.
The Afterpay share price has seen strong growth since the March 2020 selloff. The recent capital raising gives Afterpay more funds to deliver underlying sales growth. Who knows how Afterpay shares will perform over the rest of 2020? I don’t think I could bring myself to buy shares of Afterpay today due to the high valuation and uncertainty about profit generation. I’d rather buy a business with a clear path to profit like Bubs (ASX: BUB).
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