The Worldline stock is down nearly 59% over the last five days.

Shares in Worldline (EPA: WLN) tumbled by almost 60 percent in Paris as the French payments group revised its sales outlook downwards and took steps to combat fraud by severing ties with certain clients. This decline pushed the company’s share price to €9.4 on Wednesday, resulting in a market capitalization of €2.7 billion. The payments sector experienced a significant sell-off in response to this warning, impacting both European and US peers.

Worldline, one of the world’s largest payment specialists, pointed to a challenging economic environment, particularly in Germany, its largest market, as a key reason for the reduction in revenue forecasts for 2023. The company now anticipates growth of 6 percent to 7 percent, down from the previous projection of 8 percent to 10 percent. (FT)

Additionally, the group adopted a stricter approach to cybersecurity risks, severing ties with some merchants, which raised concerns about potential broader regulatory crackdowns in the sector.

Worldline also revised its operating margins, indicating a drop of 1.5 percentage points this year, whereas an increase of one point had been expected. Third-quarter sales fell short of expectations, and the company abandoned its long-term targets beyond 2023. This downgrade in outlook came as a surprise and was described as a “shock” by analysts.

Gilles Grapinet, the CEO of Worldline, cited an economic slowdown, particularly in Germany, as a significant challenge. The warning has raised concerns about a prolonged consumer spending slowdown, contrasting with the company’s previously optimistic outlook, which was fueled by a post-COVID-19 surge in consumer spending.

Other payment companies, such as Nexi (BIT: NEXI) and Adyen (AMS: ADYEN), also saw declines in their share prices, reflecting the sector-wide impact of Worldline’s announcement.

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