Navan hits lowest market cap since IPO as shares slide 50% in less than two months
Revenue growth masks deepening losses in first quarter as a public company.
After Navan’s stock fell sharply following its IPO, the fintech company published its first earnings report as a public company, revealing a mixed picture of growth and deepening losses. The company closed Tuesday at its lowest market capitalization since going public, $3.2 billion, down over 50% from its $6.7 billion IPO valuation in late October.
Founded in 2015 by Ariel Cohen, CEO, and Ilan Twig, CTO, Navan raised $920 million in its IPO. Its platform allows companies to manage all aspects of business travelת from booking flights and hotels to arranging dining and entertainment for clients (a market known as “bleisure”) and processing travel payments and expense reimbursements. This positions the company in a $185 billion market, though it faces competition from major travel providers such as Booking and American Express, as well as fintech competitors like Ramp and Brex.
The first earnings report reflects a familiar theme: strong revenue growth paired with significant losses. Navan reported $195 million in revenue for the third quarter, a 29% increase from the previous year, and noted that October was a record month. Gross profit margin, excluding one-time accounting items, reached 74% of revenue, supported by increased use of AI in customer support. Non-GAAP operating profit improved to $25 million from $6 million last year.
Despite these gains, net loss ballooned to $225 million, with roughly $100 million attributed to an accounting item related to debt repayment. Including accounting adjustments, operating loss widened to $79 million, compared with a $19 million loss in the same quarter of 2024.
Navan’s CFO, Amy Butte, who took office only a year and a half ago, is leaving the company in January. Management said she built the company’s financial infrastructure and is moving on to new opportunities. The company is now searching for a new CFO amid growing investor concern.
The current quarter (November-January) is expected to be seasonally weak, with projected revenue of $161-163 million, bringing full-year revenue to $685-687 million, a 28% increase over last year. Cash burn improved to $11 million, and the company holds $809 million in cash, with debt reduced to $200 million. Nonetheless, Navan forecasts an operating loss of $14.5-15.5 million for the quarter, citing seasonal weakness.
Navan also reported that its corporate credit card volume increased 12% to $1.1 billion, reflecting growing adoption of its payments platform despite overall financial challenges.
