The Roaring Twenties: Fashionably Late or Forever Delayed?

Beyond the Headlines

With tariffs shaking up global trade and economic signals flashing mixed messages, I wanted to try and make sense of where we’re headed. My day-to-day revolves around the Tech / FinTech and Crypto space, so diving into its trends since April 2nd—'Liberation Day'—feels like the perfect starting point to examine this madness.

The financial technology sector is a strong indicator of economic health, as it directly impacts how financial services are delivered and used, influencing everything from consumer spending and investor appetite. Hence, I wanted to examine the B2B payments sector, specifically its year-to-date trends and developments since April 2nd, dubbed “Liberation Day.”

Tariffs are poised to significantly influence the global economy, introducing challenges such as inflation, demand destruction, and disruptions in cross-border trade. Industry analyses from J.P. Morgan, Piper Sandler, Susquehanna, and recent earnings reports highlight vulnerabilities and resilience among key players, with varying impacts based on business models and market exposure.

President Trump has raised...? No…lowered? Raised again? Who knows, and it's likely changed since I published this, so here are some funny memes instead:

Politics aside, many argue we need a level playing field and a strategy to reduce debt for the sake of my generation and future generations. The administration claims to be working toward this, but at a steep, multi-trillion-dollar cost.

Will it be worth it? I guess time will tell.

Who’s Thriving & Who’s Surviving

(1) BILL stock fell ~55% in early February 2025 following its Q2 FY25 earnings release due to slowing revenue and customer growth, a declining take rate, and contracting gross margins.

• Spend-Centric vs. Software-Driven Models: Companies like Paymentus and Lightspeed, reliant on discretionary spending, face heightened risks due to tariff-induced spending cuts, making them vulnerable to demand destruction (J.P. Morgan). In contrast, software-driven firms like BILL and Paychex benefit from recurring revenue and operational necessity, offering resilience against economic pressures (J.P. Morgan). Non-discretionary payment providers like ADP and Global Payments are less impacted, maintaining stability due to their essential services (J.P. Morgan).

  
  

  Cross-Border Exposure: Firms with significant cross-border payment reliance, such as Flywire, face risks from tariff-related trade disruptions and visa policies, which could compress margins and volumes (J.P. Morgan). Flywire’s international payment focus makes it particularly susceptible, as cross-border flows are already showing impacts (Susquehanna), and reliance on higher take-rates may further challenge monetization (Piper Sandler).

  
  

  SMB Cost Pass-Through: As SMBs face growing pessimism around inflation, high interest rates, labor shortages, and tariffs, they plan to pass tariff-driven costs to customers (Susquehanna). This could reduce transaction volumes for B2B payment companies like Paymentus, Lightspeed, and BILL if demand weakens, especially for discretionary services (Susquehanna). BILL and similar AP/AR firms like Global Payments may face a “double whammy” of lower yields and reduced spending (Piper Sandler). However, network tailwinds from planned fee reductions by Visa and Mastercard could provide some relief for transaction-focused firms like Global Payments (Susquehanna).

  
  

Earnings Amidst the Storm

• BILL: Q2 FY25 revenue up 12% ($357.2M), with steady B2B payment volume growth; FY25 guidance ($1.44–$1.50B) suggests resilience despite tariff risks

• Paymentus: Q4 2024 revenue up 15% ($197.2M), but inflation flagged as a risk for transaction-based B2B volumes

• Flywire: Q4 2024 revenue up 18% ($140.1M), but tariffs and visa issues lower FY25 outlook, impacting cross-border B2B payments

• Lightspeed: Q3 FY25 revenue up 14% ($260.3M), with tariff-driven merchant cost pressures noted

• Global Payments: Q4 2024 revenue at $2.29B; tariffs cited as a risk for global B2B transaction volumes

Conclusion

Since “Liberation Day” on April 2, 2025, the B2B payments sector and overall market have navigated a stormy economic landscape shaped by tariffs, inflation, spending cuts, and even tweets that swung the market trillions of dollars. Paymentus and Lightspeed have surpassed pre-Liberation Day levels, gaining 16.5% and 12.6%, respectively, while Flywire, Paychex, ADP, and BILL lag behind. The market has been harsh on Global Payments, which took a 25.4% hit over the past four weeks, mainly due to its $24B Worldpay acquisition. Meanwhile, the broader market reflects a mixed picture. The NASDAQ and S&P 500 remain down 4.1% and 2.5% from pre-Liberation Day levels, yet U.S. stocks have rallied recently, with the S&P 500 posting its longest winning streak since January and its second-best week of 2025, and the Nasdaq flipping positive year-to-date.

This momentum stems from trade deal optimism, particularly a renegotiated China agreement, and President Trump’s assurance that Fed Chair Jerome Powell will stay, calming tariff jitters and injecting cautious hope. Interestingly, U.S. stocks are underperforming global markets year-to-date by the widest margin in over three decades, yet the U.S. economy continues to display its trademark resilience. As former Intel CEO Andy Grove said,

"Bad companies are destroyed by crises; good companies survive them; great companies are improved by them."

So, the question on all our minds: Are the Roaring Twenties fashionably late or forever delayed? Well, if Tom Brady could orchestrate a comeback from down 28-3, then surely an American economic resurgence is within reach. On a more concrete note, my high-level overview of the resilient B2B payments sector gives me reason to believe its strong earnings and positive guidance indicate a robust economic base. This strength suggests the broader market will follow suit, with the sector's performance acting as a leading indicator of economic improvement. Overall, America's limitless potential, based on various factors I could write a book on, makes a significant economic upswing a very real possibility.