Financial-technology stocks were falling early Wednesday. A warning from a major European payments company was sending jitters through the industry.
Worldline, a major payments company based in France, slashed its full-year guidance on Wednesday as an economic slowdown hit sales and profitability in key markets.
Consumers are directing their spending toward essential items such as housing and food, rather than discretionary expenses such as entertainment or luxury goods, Worldline said.
Worldline shares fell 58% in Paris. The warning spread nerves throughout the payments and fintech industry. Shares of payments company Block and PayPal Holdings (PYPL) was down over 4%.
Worldline focuses on business in Europe, and specifically called out Germany as a country where the macroeconomic environment was deteriorating. Worldline said it is now expecting 6% to 7% growth in organic sales for the year, after previously forecasting 8% to 10% growth this year.
PayPal generated around 18% of its revenue from Europe last year, while it accounted for just 3.3% of Block’s revenue, according to FactSet.