ShopBack chases profit points as FY2024 revenue rises

ShopBack made some tough calls last year. In its chase for sustainable growth, the Singapore-based startup laid off 24% of its staff and exited the buy now, pay later market.

But it appears that these decisions may have been made so ShopBack could maintain an upward trend. The company reported a top-line increase for the year ending March 2024 (FY2024), according to its audited financial statements.

ShopBack’s revenue reached S$133 million (US$102.4 million) for FY2024, marking a 13% rise from the same period the previous year.

Meanwhile, its losses from operating activities narrowed by 36.3%. This occurred as the startup coupled its revenue increase with a decrease in expenses.

Saving cash

Founded in 2014, ShopBack offers cashback and rewards to customers when they make purchases from its partner merchants. The company has since raised around US$331 million in funding from investors like Temasek, East Ventures, and SoftBank.

Shopback generates revenue through two major streams: commissions and vouchers.

A promotional photo shoot for ShopBack / Photo credit: ShopBack

The first one comes from the company’s affiliate marketing services through its rewards and discovery platforms. The second, on the other hand, is from the sale of digital vouchers for deals on marketplaces like Shopee and Zalora and online stores of brands like Nike, Adidas, and Uniqlo.

These areas account for over 83% of ShopBack’s FY2024 total. But while revenue from commissions grew by 43.3%, voucher revenue fell by 33.3%.

Huanmin Huang, ShopBack’s chief of staff and acting CFO, explains to Tech in Asia that the decrease in voucher revenue was due to a “strategic shift from an inventory model (where revenue is recognized on a gross basis) to a consignment/marketplace model (where revenue is recognized net of how much ShopBack paid for the vouchers).”

“This reduces exposure to inventory risk with no impact on gross profit,” he adds.

ShopBack did not comment on whether this trend has continued into its 2025 financial year as the company is currently in the middle of its year-end audit.

On top of commissions and vouchers, ShopBack also generates earnings from advertising. Although the segment contributed a small percentage of the startup’s FY2024 total, revenue from it increased by 26.2% in the same financial year.

As for ShopBack’s narrowing loss from operating activities, its reduction in spending mostly came from an over 45% drop in other expenses. Huang shares that this was due to a one-off goodwill impairment recognized in FY2023.

A bigger basket