Why Global-e Online Stock Plunged This Week
Shares of cross-border e-commerce solutions provider Global-e Online (NASDAQ: GLBE) were down by 25% this week as of 9:30 a.m. ET Friday, according to data provided by S&P Global Market Intelligence.
The growth company reported earnings on Wednesday but left the market wanting more after it offered weak guidance tied to concerns about the United States potentially imposing new tariffs.
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Short-term pain, long-term gain?
Global-e Online's platform solves many of the complexities involved when a merchant sells internationally. The company offers checkout services in 30 languages, provides pricing in over 100 currencies, accepts 150 payment methods, collaborates with 20 carriers for delivery, and calculates import duties and taxes in 170 markets.
If you're a merchant struggling with your conversion rates on international sales, Global-e can get things sorted out for you. This value proposition for its customers continues to shine as Global-e grew revenue, adjusted gross profit, and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) by 42%, 53%, and 62%, respectively, in the fourth quarter.
Despite these impressive-looking results, the company's shares dropped as it guided for "only" 25% revenue growth in 2025 due to uncertainty stemming from American tariffs and the havoc they could cause with Global-e's merchants.
However, management believes this short-term pain could turn into a long-term benefit. During the earnings call, co-founder and President Nir Debbi explained, "We do believe that there will be uncertainty. It might affect short-term consumption. But overall, in the longer term, we do expect it will behave the same way we've seen in Brexit, where overall, it created much more demand for our services."
Ultimately, Global-e's growth story should remain intact regardless of the tariffs. However, trading at 62 times free cash flow (accounting for stock-based compensation), interested investors might be best buying the stock in thirds.
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Josh Kohn-Lindquist has positions in Global-E Online. The Motley Fool has positions in and recommends Global-E Online. The Motley Fool has a disclosure policy.
