Fintech unicorn Revolut’s losses double as it pushes for global expansion

British financial technology start-up Revolut’s losses doubled in 2018, the firm said Tuesday, as the company embarks on an aggressive global expansion.

The London-headquartered firm recorded a £32.8 million ($40.3 million) net loss on revenues of £58.2 million for 2018. That was more than double the £14.8 million loss it posted a year earlier, while revenue climbed 354%, according to CNBC.

But the company added that its gross profit margin had improved despite the cost of sales jumping 247%, as that figure was lower than the rise in revenue. Revolut attributed the rise in costs to card scheme charges and user acquisition.

The company is one of many so-called challenger banks that have gained ground in Europe — particularly in the U.K. — offering little more than a bank card and a mobile app. One of its domestic competitors, Monzo, recently disclosed that losses jumped to £47.2 million in the fiscal year ending February 2019.

TransferWise, meanwhile, has been among the few fintech unicorns to have crossed into profitable territory, having recently posted its third year in the green.

Revolut has topped both TransferWise and Monzo in terms of users however, with its overall customer count having recently passed the 7 million mark. The firm claims to have an average 3.7 million active users each month and 1.1 million daily active users.

However, there is an interesting comparison: while @revolutApp has 7m users and 1.1m daily actives – 16%, @monzo has 3m users and 1.7m daily actives – 57%.

Revolut is planning to raise a fresh round of funding later this year, with reports indicating that it could pull in as much as $500 million from investors. The company’s CEO, Nik Storonsky, has in the past told CNBC that SoftBank could be a “potential partner.” The firm last raised venture funding in April 2018 at a $1.7 billion valuation, making it one of the most valuable unicorn companies in Europe.