At first glance, Cardlytics (NASDAQ: CDLX) has a very compelling story: part fintech and part digital marketing, both of which tend to be high-margin, fast growing areas. If you use a mobile banking app and have seen promotions for bonus cash back offers at places like Starbucks, you've seen Cardlytics' service. Through 2019, the company was growing revenue at an exciting compounded annual growth rate of 40%. But recent shifts in marketing spend show that the company's unique position and strategy may not be as competitive as other marketing companies.
Image Source: Cardlytics
The company's quarterly revenue and billings (basically, the total bill sent to customers -- a signal of demand for Cardlytics's services before complex accounting or even payment) were on a fairly steady streak up and to the right over the past 10 quarters. Then came the semi-expected COVID slump. Both billings and revenue fell more than 40% year over year .