Green Dot (GDOT) reported a 4% jump in second-quarter profits even as its flagship prepaid card franchise continued to face pressure from new competitors.
The Pasadena, Calif., company announced Tuesday that it earned $11.3 million in the second quarter, up from $10.9 million a year earlier. Earnings diluted per share were stable at 25 cents, while operating revenue rose to $140.6 million, up 4% from the same period a year earlier. All of the results relied on generally acceptable accounting principles.
The company said it was pleased with the results, which were negatively impacted both by tougher competition and tighter restrictions on the use of Green Dot's prepaid cards.
Green Dot also stated that it is revising upward its revenue and earnings estimates for all of 2013.
Metrics on the use of Green Dot's prepaid cards were mixed.
At the end of the second quarter, Green Dot had 4.39 million active prepaid cards, or about 100,000 fewer than it had three months earlier. Purchase volume for the quarter was $3.2 billion. That was down from $3.6 billion in the first quarter, but higher than the $2.9 billion in purchase volume the company recorded in the second quarter of 2012.
Green Dot also announced Tuesday that its products are being rolled out to Home Depot, Kroger, Dollar General and Save-a-Lot stores, and that the company has launched a new initiative to offer prepaid cards at check cashing stores throughout the United States.