Tabby, a leading Buy Now, Pay Later (BNPL) provider in Saudi Arabia, reported a strong profit surge in H1 2025, with net profit reaching $24 million , compared to $5.2 million during the same period in 2024.
The significant improvement in profitability was driven by:
- Higher net financing income, resulting from: A. A 43% increase in commission income from merchants, totaling $158 million, up from $110.4 million.
B. A 136% increase in customer revenues from payment term extensions, reaching $9.95 million, compared to $4.2 million, along with increased other income. - Franchise fees dropped by 21% to $14.5 million, down from $18.4 million. This follows a restructuring of franchise and service agreements with Tabby Technology Ltd. (a related party), reducing fees to 2% of total revenue for IP usage, plus a 6% service margin, compared to a previous 25% fee paid to FZ LLC.
- Credit loss provisions declined by 15% to $21 million, down from $24.8 million, thanks to lower non-performing loans and reduced marketing expenses.
Despite these improvements, several cost pressures persisted:
- No revenue from late payment fees was recorded in H1 2025, compared to $6.1 million in the prior year, following Tabby’s December 2023 decision to halt late fee charges as part of a Shariah-compliance initiative.
- Financing commission expenses rose by 49%, reaching $98.4 million, compared to $66.1 million.
- General & administrative expenses and staffing costs increased.
- Income tax rose to $6 million, up from $1.3 million, with the prior period benefiting from a $3.7 million deferred tax refund.
