H2 2023

Shareholder letter
Shareholder letter H2 2023 2

Processed volume Net revenue EBITDA

H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2
2022 2022 2023 2023 2022 2022 2023 2023 2022 2022 2023 2023
345.8 421.7 426.0 544.1 608.5 721.7 739.1 887.0 356.3 372.0 320.0 423.0

H2 29% YOY H2 23% YOY H2 14% YOY MARGIN 48%

€544.1 BN €887.0 MN €423.0 MN

FY 26% YOY FY 22% YOY FY 2% YOY MARGIN 46%

€970.1 BN €1.6 BN €743.0 MN

Expanding existing customer Hiring gradually slowed as Commercial ambitions

relationships delivered a the team reached its next were bolstered by
period of profitable growth intended scale iterative product
innovation
● Net Revenue was up 23% YOY, driven by ● We concluded our two-year accelerated
continued growth across our existing customer investment period of significantly scaling our ● Throughout H2, we further invested in a
base, consistent with our underlying land-and- global team, which brought the company to its range of new and existing functionalities,
expand fundamentals. next level of maturity. from alternative payment methods to
platform automations and optimized routing.
● Across each pillar, a range of variables determine ● EBITDA margin was 48%, reflecting our
exact go-live and roll-out dates, underscoring why intentionally slowed hiring pace. ● With many customers shifting focus to
maintaining a long-term commercial view is core to optimization this year, we helped them
our decision-making and continued to serve us ● We continued to prioritize hiring outside of improve conversion rates, reduce fraud, and
this period. Amsterdam across our tech and enable significant operational efficiencies.
commercial domains.
● Growth is not always linear, as demonstrated ● Though it will take time for the impact to be
across our commercial pillars. In the second half of realized, we adapted our sales and account
H2, we significantly expanded our relationship with a management strategies to better emphasize
single, existing Digital customer. Unified Commerce the total cost of ownership benefits
grew steadily despite inherent retail exposure. Adyen brings.
Platforms saw continued traction as the appetite for
embedded payments further scaled.
Shareholder letter H2 2023 3

A period of expansion
for our global team and
customer relationships
Dear shareholders, February 8, 2024
It's been just a few months since we were together at our Investor Day in
San Francisco, which is still fresh in our minds. The market's reaction to our
H1 results motivated us to host the event. At the time, challenging dynamics
including shifting customer priorities – which have and will always evolve –
posed a number of potential distractions as we executed our strategy. While
navigating the turbulence we all experienced, our team spent time in
dialogue, listening to your feedback, and making improvements where
needed. We thank you for your valued input, and are pleased to have
implemented meaningful changes that are built upon throughout this letter.
Shareholder letter H2 2023 4

Our deliberate shift towards enriching our investor communications was

one positive development. In November, we specified our expectations for
the coming three years, discussed our product and commercial strategy,
introduced you to a number of our global leaders, and provided more
detailed metrics per pillar. By broadening and deepening the insights
shared, we hoped to impress upon you that we have been proceeding with a
clear vision. H2 validated our ability to execute on our long-term approach
while also addressing your pressing feedback. As a result of this discipline,
we scaled our global team to its most far-reaching to date and grew with our
customers across each pillar.
Indeed, H2 2023 was an exercise in continued focus. Looking at it by the
numbers, we closed the year with a solid set of results. This period, our net
revenue landed at €887.0 million, up 23% YOY, driven as usual by our
customers’ continued growth on our single platform. Even after a two-year
accelerated investment period in our team, EBITDA had full-year growth,
with H2 up 14% YOY. EBITDA margin landed at 48% for H2, a metric
reflecting our deliberately slowed hiring. Still, we welcomed 313 new joiners
in H2, bringing us to a total of 4,196 FTEs at the year's end. Net income
outpaced this growth, as it also benefited from significant interest income in
the period. Building our team over the last two years was a counter-cyclical
decision compared to much of the industry, enabled by the profitable
business we built and the flexibility it provided amid a favorable
talent market.
As planned, H2 saw us gradually slow our hiring as we brought the company
to its next stage of maturity. We now have the team equipped with the skills
required to execute on our key growth ambitions, and to do so at scale. In
line with our business strategy, the majority of H2 hires sat in tech and
commercial roles located in offices outside of Amsterdam, which will remain
the focus when we hire as needed moving forward. Over the course of 2024,
we plan to onboard a couple of hundred net-new joiners. As previously
communicated, the tempering of our hiring will allow our operating leverage
to again become visible in our financials. Though this process will begin in
2024, the operational impact will be less visible as 2023 hires annualize,
followed by more material leverage in 2025 and 2026.
As was essential to our hiring ambitions, we similarly recognized the
importance of maintaining a long-term outlook from a commercial
perspective. Across each pillar, a range of variables determine exact go-live
dates. Each technical roadmap is unique. Negotiation periods can span the
spectrum of many years to just a few weeks. Furthermore, roll-out
complexity varies drastically between digital businesses compared to
enterprise, global point-of-sale (POS) retailers. Pillar growth is therefore not
always linear, and the importance of zooming out to the long-term trajectory
cannot be overstated.
H2 2023 exemplified this, as Digital volume growth increased to 33% YOY,
compared to 23% in H1 2023. This acceleration was predominantly driven
by the further ramp-up of an existing customer in Q4. Substantial wallet-
share growth with our customers undoubtedly drives value for our business,
even when our tiered pricing model means volumes may outpace revenue.
This is why we consciously manage on net revenue rather than take rate.
Shareholder letter H2 2023 5

In North America, we further realized the growing opportunity presented by

the region's digital sophistication. While it has long been dominated by card
payments, the landscape is becoming more complex due to new payment
methods, digital wallets, and regulatory changes – making it a dynamic
environment ripe for innovation as businesses seek to keep pace. With our
strategic investments in our US branch license and alternative payment
methods like open banking, we ensure that our North American customers
not only remain ahead, but also optimize their costs and processes along
the way. This proposition resonates, and North America was our fastest
growing region in H2 due to continued market share and volume growth
with the majority of our largest digital customers.
Meanwhile, Unified Commerce volume grew steadily but at a slower pace in
H2 at 24%, compared to 36% in H1. Despite the pillar’s inherent retail
exposure – a vertical in which we saw a broader industry slowdown – we
continued to handle peak volumes and record activity levels during Q4’s
holiday season. Our infrastructure soundly combatted heightened fraud
attempts and maintained the seamless experiences today’s shoppers not
only expect, but demand. As the world continued to fluidly blur the channels
across which purchases are made, we bolstered our leading position
enabling this movement.
Being at the forefront of cross-channel journeys was illustrated by our S
Group win, for whom we will process their portfolio of large-format grocery
stores, restaurants, hotels, and service stations. While the retail factors
mentioned above are at play in the near-term, longer-term trends remain
intact, including the emerging digitalization of historically less obvious and
large-format industries, for which we are the partner of choice. This Unified
Commerce driver was underscored by our large-format retail activity
sustaining YOY growth momentum in H2.
Demonstrating the functionality advantage and value we bring, this period,
we entered a partnership with Straumur, a subsidiary of Kvika Bank hf.
Straumur joins our growing number of financial services customers who are
turning to Adyen’s technology to round out their offerings and meet
advancing consumer expectations – not only in Digital and Platforms, but
also in Unified Commerce. With a focus on user experience, the rapidly
digitalizing financial services industry is a prime example of how our
diversifying customer base reinforces our substantial opportunity. The wider
group of verticals blending online and offline journeys, alongside our
untapped potential in regions like North America, bolsters our confidence in
Unified Commerce as a business driver.
Platforms also saw continued traction as the SaaS business model further
embedded payments into its offering, a trend spreading across new and
highly specialized verticals, such as parking technology and dental practice
management, to name a few. This contributed to the pillar growing 19% in
H2 compared to 3% in H1. A significant success story this period was with
major, multinational technology company, Oracle, for whom we are working
to offer their customers a complete payments solution: Oracle Payments.
Aligning with our shared goal of powering superior experiences for
ambitious businesses, in 2024, we plan to expand our partnership into the
UK and diversify into new verticals.
Shareholder letter H2 2023 6

This cycle, we secured an exciting land-and-expand win with BILL, a leading

financial operations platform for small and midsize businesses, to deliver
advanced acquiring and issuing experiences for BILL’s accounts payable
(AP) and accounts receivable (AR) solutions. The partnership, which started
with Adyen for Platforms’ card acquiring, has grown to include card issuing
capabilities, marking a natural progression across Adyen’s platform
offering. Issuing traction has also been promising more broadly. Compared
to H2 2022, during which we processed in the tens of millions, this period,
we processed more than 100 million euros in issuing volume. While we still
have a long way to go before it becomes a significant contributor, we see
great promise in Adyen’s growing enterprise customer base adopting this
newer product.
To continually improve how we meet customer priorities, we adapted our
sales and account management strategies to better emphasize the total
cost of ownership benefits Adyen brings. This includes explaining how
unifying sales channels drives efficiency in new verticals; how reduced fraud
and approval uptick supports Digital customers; and how embedding
payments and financial services helps increase stickiness while opening
new revenue streams for Platforms businesses. While it will take time for our
evolved conversations to convert new business, we are enabling current and
potential customers to better understand that Adyen is not only the financial
technology provider to drive revenue, but also the one to help reduce
backend operational and overall payments costs in the process.
Looking back at H2 2023, a number of challenges had the potential to divert
our attention, but were navigated with many positive outcomes. As a result
of this cycle, we implemented meaningful change in our investor
engagement, iterated our sales and account management approach, and
succeeded in both team and customer expansion. To get there, our focus
was fixed on our north-star objective: to be the financial technology platform
of choice for leading global businesses. Over an extensive runway, this will
define the value of our company. Remaining long-term focused has always
and will continue to serve us. We look forward to continuing in this
stead in 2024.
Shareholder letter H2 2023 7

Driving commercial
growth through
iterative product
innovation
Our land-and-expand approach remains the linchpin of our commercial
strategy. By forging robust relationships from the outset and partnering to
meet ever-changing consumer preferences, we once again experienced
over 80% of our growth coming from existing customers, with less than
1% volume churn.
In complex regulatory environments, our single platform makes a
compelling offer of simplicity and remains one of our key differentiators.
Particularly as regulation tightens around the capture and usage of
payment data, our technology offers a cohesive, agile, and – most
importantly: compliant – global solution. In H2, we further expanded our
global capabilities by obtaining our UK banking license.
Equipped with this new license, we were able to successfully obtain direct
access to the Bank of England's (BoE) centralized clearing and
real-time payment rail (the Faster Payments Services, or FPS). Much like
our investment in North America in H1 2023, during which we received
certification to be among the first to utilize the Federal Reserve’s instant
payment infrastructure, our BoE connection and direct FPS access will
facilitate settlement capabilities and instant payouts for our UK customers.
Additionally, this new license supports our ambition to further expand our
financial services capabilities.
Our post-Brexit investment builds upon Adyen's commitment to meeting
and maintaining high regulatory standards across our regions of operation.
It enhances our end-to-end control over the payments process while
leveraging our local expertise. Beyond Adyen’s deepened presence in the
UK, in H2, we also worked closely with card schemes and regulators to
anticipate the upcoming PSD3 directive in the EU. By proactively and
thoroughly preparing for upcoming regulatory shifts – even before
clear implementation timelines are established – we position our
customers for success and ensure they stay ahead of
evolving requirements.
Guided by our long-held philosophy of customer-driven innovation,
throughout H2, we developed a range of product enhancements to further
improve conversion rates, reduce fraud, and enable significant operational
efficiencies for our customers. Most notably, we further invested in
Shareholder letter H2 2023 8

alternative payment methods and strategic platform automations, which

include compliance processes and optimized authentication routing.
These initiatives not only contributed to performance uplift but also tangible
cost reductions for our customers. As our platform advances and our
presence in key markets solidifies, we are continually becoming more
attractive to a wider group of verticals, including large-format retail,
hospitality, and financial services companies. We will dive further into these
pillar and product developments below.
Shareholder letter H2 2023 9

Digital
As our longest-standing and most established offering, digital payments
continue to generate the largest amount of volumes, and significantly
contributed to them again in H2. Consumer preferences – which are further
digitalizing at every turn – are driving the global demand for more seamless
payment experiences. By leveraging the simplicity of our end-to-end
solution, we drive digital performance, support our customers’ growth
priorities, and, crucially, enable cost efficiencies along the way.
One of the primary avenues through which we drive cost optimization for
our customers is by identifying opportunity amid complexity. In our
collaboration with WorldRemit, for instance, an international money transfer
service with a complex network of payment partners, we enabled a
significant consolidation. Our single platform now serves as the processor
and acquirer across their global operations. By streamlining their once
complex, multi-partner setup, we helped deliver substantial operational
efficiencies and a unified view of their activities.
Attesting to our sizable opportunity in the US, as well as of the robustness of
our land-and-expand strategy, our Digital pillar growth in H2 was in part due
to the meaningful expansion of a relationship with an existing customer.
Over time, we have expanded our relationship with Cash App. Historically,
we partnered on processing their international volumes, including for
Afterpay. Following our land-and-expand strategy we are now a partner for
domestic volumes as well, and ramped these volumes in the fourth quarter.
Building our single platform entirely in-house positioned us to play the long
game. As the financial services industry rapidly digitalizes, partnerships like
those above demonstrate Adyen's role as a trusted, long-term collaborator.
Leveraging our advanced suite of products and solutions, we are uniquely
positioned to drive innovation and fill technological gaps, even across more
mature financial services offerings.
In H2, we announced the upcoming launch of our Pay-by-Bank services in
North America in partnership with digital finance innovator, Plaid. Building
on historical investments in both our US branch license and our local Tech
Hub, we are excited to work with Plaid to offer businesses and end-
consumers alike an unparalleled Pay-by-Bank experience. The recent
launch of Adyen's Open Banking Gateway, which provides more control and
enables us to better route open banking transactions, underpins this
investment. This increased efficiency translates to lower transaction costs,
thus contributing to a reduced total cost of ownership for our customers.
Offering a wide range of benefits to our customers, as well as greater choice
and flexibility to consumers, Pay-by-Bank joins a growing list of more than
150 payment methods offered on our single platform. Additionally, outside
of the US, we continue to invest in local payment methods in multiple
markets, saving both time and complexity for our customers looking to
reduce friction for consumers and increase conversion in the payments
process. This period, we launched a range of local payment methods across
some of our key markets, including PayPo in Poland, Billie B2B in the EU,
and ANCV in France.
Shareholder letter H2 2023 10

Top 100 Digital customers using local payment methods

Using LPMs

91%
Another exciting development in H2 was the expansion of our Klarna
partnership. Klarna, an AI-powered global payments network and shopping
assistant, selected Adyen to act as one of their acquirers on behalf of their
different customer offerings, beginning in 2024 across Europe, North
America, and Asia. Through this partnership, we look forward to supporting
a more seamless payment experience for Klarna's 150 million consumers
and 500,000 retail partners worldwide.

+40% +33%

338.4

253.8

181.6

H2 2021 H2 2022 H2 2023

Processed volume

Figure 1

Digital: Processed volumes (in billion euros) of non-platform

merchants that process over 99.5% of their volumes online.
Shareholder letter H2 2023 11

Unified Commerce
Within our Unified Commerce pillar, our long-term opportunity remains
robust. With businesses around the world increasingly digitalizing, the
largest share of payments are still being processed in store, and the lines
continue to blur between digital and in-person retail experiences. We are
therefore honing in on the verticals in which we already have a stronghold,
such as luxury retail and hospitality, as well as those where we are starting to
see positive traction, like large-format retail. Although short-term
macroeconomic fluctuations can have an impact, our long-term strategy
positions us well to navigate the changing tides of consumer behavior. As
verticals evolved, the pervasiveness of cross-channel payment experiences
acted as a tailwind for this pillar’s sustained growth.
Substantiating our opportunity in new verticals, H2 saw the inclusion of two
leading large-format retail brands to our customer portfolio: Finland’s
largest retail group, S Group, and German multinational home improvement
brand, OBI. With more than 500 million transactions annually, our
partnership with S Group aims to integrate their online and offline channels,
delivering a robust omnichannel experience and enhancing loyalty program
capacity across their extensive brand portfolio. This will cover a diverse
range of establishments and more than 1,900 locations and online
channels, including grocery stores, restaurants, hotels, and service stations
across Finland and Estonia. Similarly, in our partnership with OBI – a
household name in the eight European countries where it operates – we will
provide dual support through both our POS capabilities and our Adyen for
Platforms (AfP) solutions, highlighting the accelerating trend toward
digitalization in less obvious sectors.

Number of Unified Commerce customers

processing across channels at scale
H2 2023 YOY

320 ↗68
Shareholder letter H2 2023 12

As many Unified Commerce businesses continue to seek cost efficiencies,

we have harnessed the strength of our risk engine to support this ongoing
priority. In partnership with True Alliance, in which our single platform
streamlines payment processing across its 19 premium brands in Australia
and New Zealand, our robust fraud protection has already proven highly
effective, bringing fraud rates under 0.1% and contributing to estimated
annual cost savings of up to AUD 1.4 million.
We also continue to reinforce our commitment to innovation and the global
reach of our Unified Commerce capabilities. Following the launch of Tap to
Pay on iPhone in the US in 2022, and our expansion of this service to the UK
in the first half of this year, we have now expanded further to France, the
Netherlands, and Australia, with plans to introduce the service in new
regions. This in-person payment (IPP) feature enables our customers to
accept contactless payments on iPhone, removing the need for additional
hardware and resulting in a more streamlined payment experience.

Number of transacting Unified Commerce terminals

H2 2023 YOY

277K ↗75K
Whether in mature or emerging markets, we are becoming the domestic
partner of choice for leading brands. Our partnership with Frasers
Hospitality, an award-winning serviced apartment brand, illustrates this
journey, wherein our single platform empowers them to offer frictionless
guest experiences across key regions including Singapore, Malaysia,
Australia, and Europe. From more streamlined check-in and check-out
experiences to diverse payment journeys online and offline, including local
major credit cards and local payment methods, Adyen’s innovative and
efficient solutions continue to meet the evolving needs of the hospitality
industry. Continuing to expand our reach in this vertical, we also welcomed
Shangri-La Group to our growing customer portfolio this period.
With significant potential in regions like LATAM, we continue to invest in
order to seize these exciting opportunities. Up to this point, in line with our
tried-and-tested strategy for entering new regions, we have set up select,
strategic partnerships. While these partnerships, such as our BIN-sponsors,
were essential to securing our initial market entry, some naturally
introduced dependencies that resulted in growth below our desired pace.
As we mature in the region, we can scale back these partnerships and
further unlock the full potential of our single platform. Combined with our
historic investments, including our full acquiring capabilities, our regulatory
license, and the launch of an increasingly popular local payment method,
Pix, we stand poised to transform the retail experience for consumers and
drive growth for our LATAM customers.
Shareholder letter H2 2023 13

Number of Unified Commerce customers

processing in multiple regions
H2 2023 YOY

500 ↗52
In the meantime, we remain committed to capturing ongoing opportunities
throughout the region, and see increasing traction with Unified Commerce
customers especially. In a new partnership with VTEX, for example, a
Brazilian enterprise digital commerce platform offering software solutions
for managing online sales, we will be the first global acquirer integrated
into their Sales App – a solution designed for connected commerce
operations. This collaboration is set to deliver a more unified approach
for their customers.
For Unified Commerce customers, offering a diversity of local payment
methods is a key strategic driver. In H2, we collaborated on the pilot of a
popular Japanese e-wallet, PayPay, at an event with a global sports brand.
This represented a small but significant milestone in our expansion efforts
into Japan, a traditionally cash-based market. As we expand our reach
in this and other high-potential countries, such as the United States,
Mexico, and India, we purposefully lay the groundwork to strengthen
our global presence.

+58% +24%

144.2

116.1

73.6
82.1
63.7

40.6

H2 2021 H2 2022 H2 2023

POS eCom

Figure 2

Unified Commerce: Processed volumes (in billion euros) of non-platform

merchants processing at least 0.5% of their volumes via point-of-sale.
Shareholder letter H2 2023 14

Platforms
We continue to see solid momentum for Adyen for Platforms (AfP), a
business model through which we enable platform business to capitalize on
the opportunity that a transaction-based revenue model brings. Bringing
together our strongest differentiators in both global online payments and
multi-channel commerce, we ensure that businesses even at the long tail of
the market can access the value of our single platform and enterprise-grade
product suite. On top of payments, the growing embedded financial
products (EFP) opportunity further solidifies our growth potential. While
currently of limited scale, our EFP offering remains a key differentiator.

Number of Platform business customers serviced

H2 2023 YOY

87k ↗61k
As mentioned earlier, one reflection of our Platforms appeal was this
period's land-and-expand win with BILL, a leading financial operations
platform for small and midsize businesses, to deliver advanced acquiring
and issuing experiences for BILL’s accounts payable (AP) and accounts
receivable (AR) solutions. Another significant success story this period was
with major, multinational technology company, Oracle, with whom we are
working to offer their customers a complete payments solution, Oracle
Payments. In H2, we achieved further expansion with Oracle Food and
Beverage. Aligning with our shared goal of powering superior payment
experiences for ambitious businesses, in 2024, we plan to expand our
partnership into the UK and diversify into new verticals.

Number of transacting Platform terminals

H2 2023 YOY

122k ↗68k
The adoption of AfP across verticals is underscored by the diversity of
platform businesses we attracted in H2, with recent customer wins such as
CareStack, a dental practice management platform, and FlashParking, a
leading parking technology company. As well as underlining the ubiquity of
financial technology, this expansion showcases our proficiency and
opportunity in new areas. FlashParking, for example, leveraged our unified
platform to successfully streamline and simplify their payments ecosystem
and gain a consolidated view of their multiple business streams.
Our issuing capabilities have garnered increased interest from various
customers, including Onsi, who provide an easy way for companies to pay,
reward, and protect their workers. As an existing issuing customer across
the UK, Netherlands, and Poland, as well as leveraging our acquiring
capabilities to offer top-ups, they will shortly launch a range of products
utilizing our EFP suite.
Shareholder letter H2 2023 15

In addition, Centtrip, a UK-founded financial technology company offering

international payments, foreign exchange, and expense management
solutions, recently expanded its US partnership with us. The collaboration
now includes Centtrip's EU operations, allowing for a broader use of our
EFPs and issuing capabilities. This extended partnership is expected to
unlock further opportunities in the UK, enabled by our recently granted
banking license.

Number of Platform customers processing over €1 billion

H2 2023 YOY

18 ↗8
The aforementioned obtaining of our banking license in the UK was a pivotal
development in the second half of the year, further differentiating and
strengthening our position as an integrated financial technology provider.
Through this, we now have the capability to establish direct connection with
the Bank of England, providing us with a direct link to payment rails and
enabling significantly faster and more efficient payout services.
This achievement builds on the success of our faster payout services, which
we successfully launched in the EU, US, and UK in H1. We are committed to
expanding the reach of these services to broaden our EFP coverage and
ensure optimal real-time payout capabilities. Our focus also includes the
implementation of pre-build components to enhance operational efficiency
for a broader range of customers.

+16% +19%

61.5

51.8
44.8

1.2 3.9 10.8

H2 2021 H2 2022 H2 2023

POS eCom

Figure 3
Platforms: Processed volumes (in billion euros) of customers processing at
least 50% of their volumes via Adyen for Platforms (AfP).

*Excluding eBay volumes, Platforms volume growth would have been 112% YOY
Shareholder letter H2 2023 16

Impact

No business exists in a vacuum, and as we set our sights on the long-term

success of our business, we recognize our responsibility to the future of our
planet and its people. An embodiment of this commitment is our annual
pledge to dedicate 1% of our net revenue to initiatives that support the
United Nations Sustainable Development Goals (UN SDGs).
Through our donations product, Giving, we actively foster charitable impact
for the UN SDGs by empowering businesses to incorporate donation
technology into their payment flows – a traditionally complex and
burdensome process. Bolstered by the resources of our 1% fund, we ensure
that 100% of contributions reach the intended nonprofits by absorbing
scheme fees that would otherwise dilute the donation along the way.
One such beneficiary of our global fundraising at scale is UNICEF, with
whom we formalized our partnership in 2023, allowing consumers around
the world to support the global organization at checkout, seamlessly. For
UNICEF and other nonprofit partners, unlocking the power of collective
fundraising through our single contract marks a transformative approach to
collaborating with the private sector. By significantly reducing the timeline
and operational complexities in the partnering process, critical resources
can be accessed quickly and at scale. This agility is particularly crucial in
times of crisis, when the swift mobilization of funds is vital to an immediate
and effective response.
While e-commerce remained our strongest channel for donations in 2023,
POS donations have seen an impressive YOY increase, accounting for 39%
of donations in 2023 (2022: 30%).
Another focus area for us in H2 was developing our biggest product update
to date: Campaign Manager. Launching at the start of 2024, this exciting
feature will enable greater freedom and flexibility in scaling charitable
donations and positive impact. By making it easier to activate and
deactivate campaigns, Campaign Manager offers our customers
heightened autonomy, enabling them to align their charitable initiatives with
local market preferences and to cater to the diverse causes that resonate
with their consumers.
Shareholder letter H2 2023 17

The Adyen team

reached its next
phase of scale
This period, we concluded a two-year project dedicated to growing our
global team. With H2 2023 marking the final stretch of this initiative, we
intentionally slowed hiring as this accelerated investment period closed.
This meant bringing on 313 FTEs in H2 and landing at a global team of
4,196 FTEs at the year’s end. Once again, the majority of our H2 hires sat in
tech and commercial roles located in offices outside of Amsterdam. These
geographies and domains – commercial in particular – will remain our
priority when hiring moving forward. However, in comparison to 2022 and
2023’s team growth, we expect only a couple of hundred net-new joiners to
come on board in 2024.
Shareholder letter H2 2023 18

As mentioned earlier in this letter, the current cooling of our hiring will allow
the operating leverage inherent to our business model to become more
visible in our financials. Though this re-expansion will begin in 2024, the
impact will be limited as 2023 hires annualize, followed by more material
operational leverage in 2025 and 2026. Our investment in the team’s
broadened reach, specialized skill sets, and seniority will also gradually
ramp up to drive top-line impact during that time.
During H2’s final hiring stretch, we remained laser-focused on maintaining
our high talent standards. This meant prioritizing Formula fit to scale our
unique company culture and ways of working. To enable us to move quickly
and effectively without compromising on the quality of our people, we
further invested in standardizing our global onboarding program as well as
expanding our learning and development offering to include
more self-paced, independent programs and bringing our formerly external
leadership training in-house. We also continued conducting final interviews
with members of our most senior leadership teams. We are pleased that, in
2023, this group of senior leaders became further balanced with internally
developed talent alongside externally hired experts. Bringing on board more
diverse leadership perspectives and experience levels will help push us to
our next level.

There were also a few key developments regarding our approach to sales
and account management in H2. As our product offering grows and
becomes increasingly advanced, so too do the opportunities to land-and-
expand with our customers. To capitalize on the highly specific technical
advantages we bring across all products, we ‘pillarized’ our sales force –
moving it towards a more functional structure. Rather than selling our single
platform at a higher level, our commercial team is becoming better
positioned to tailor our offering and functionality to the specific needs of
each current and potential customer. One example of this, which we
mentioned earlier, was evolving our sales approach to more clearly
articulate and demonstrate our total cost of ownership advantages.
Though the decision to continue hiring was counter-cyclical to industry
trends, we are proud not to have wavered from our approach. This is the
team we are confident will execute Adyen’s key growth ambitions.
Shareholder letter H2 2023 19

Total FTEs: 4,196

North America Europe, Middle East Asia-Pacific

& Africa
H1 H2 H1 H2 H1 H2

San Francisco 296 299 Amsterdam 2,240 2,326 Singapore 156 165

New York 163 186 London 136 133 Sydney 46 53

Chicago 96 155 Madrid 86 133 Shanghai 31 36

Toronto 23 26 Paris 82 96 Tokyo 30 33

Berlin 79 91 Mumbai 9 12

Latin America Stockholm 64 76 Hong Kong 8 9

H1 H2 Milan 30 32 Kuala Lumpur 2 3

São Paulo 164 170 Dubai 26 27 Melbourne 1 1

São José 25 39 Munich 19 21

Mexico City 23 27 Warsaw 20 18

Brussels 14 15

Manchester 14 14
 Shareholder letter H2 2023 20

Discussion of
financial results
Processed volume driven by the success of our
land-and-expand strategy

We processed €544.1 billion during H2 2023, up 29% YOY. For the full year
(FY), we processed €970.1 billion, up 26% YOY. In line with previous cycles,
the majority (>80%) of our growth came from expanded relationships with
1
existing customers, and we again saw less than 1% volume churn .
Of processed volumes, 83% were full-stack volumes, up from 79% in H2
2022. This number is driven by the growing utilization of our end-to-end
capabilities, through which the full value we offer is unlocked.
We made solid progress across all commercial pillars, but continue to stress
the importance of taking a long-term view, as growth is not always linear.
Digital – our longest established but continuously growing pillar – remained
the largest volume contributor overall, realizing €338.4 billion in H2 and
€605.5 billion for the FY, making up 62% of total processed volume in 2023
and growing 28% YOY. The acceleration in Digital volumes in H2 was
primarily driven by the ramp-up of an existing customer.
Unified Commerce volumes amounted to €144.2 billion in H2 and €253.4
billion for the FY, which was 26% of total processed volume in 2023 and up
29% YOY. Despite a broader slowdown in retail, we processed record
volumes during Q4’s peak shopping season.
Platforms contributed €61.5 billion in H2 and €111.2 billion for the FY,
making up 12% of total processed volume in 2023 and growing 11% YOY.
Without eBay volumes, Platforms would have grown at 112% in H2 and 99%
for the FY.
Our point-of-sale (POS) volume was €92.9 billion in H2 and €159.9 billion
(up 42%) for the FY, comprising 16% of total processed volume in 2023, up
from 15% in FY 2022.

1
In line with previous reporting periods, growth from existing customers is defined as growth from
merchants that processed volumes in the comparable period (H2 2022). Volume churn is defined
as the aggregate processed volumes during the comparable period of all merchants that had zero
processed volumes with Adyen during the current reporting period, divided by Adyen's total
processed volumes for the comparable reporting period.
Shareholder letter H2 2023 21

Net revenue saw profitable growth as we

scaled our customer relationships
Net revenue was €887.0 million in H2 2023, growing 23% YOY. The majority
of our net revenue growth is attributed to the success of our land-and-
expand commercial track record, which continues to shape meaningful and
long-term partnerships.
Take rate decreased from last period, landing at 16.3 bps, compared to 17.3
bps in H1 2023 and 17.1bps in H2 2022. This is a natural outcome of our
tiered pricing model.
Regional net revenue contributions continued to diversify with EMEA
contributing (55%), followed by North America (27%), APAC at (11%), and
LATAM landing at (7%) in H2 2023.
North America was the fastest growing (up 27% YOY), followed by APAC
growth (up 25% YOY), EMEA (up 23% YOY), and LATAM (up 5% YOY) in
H2 2023. Throughout all regions, we see sizeable untapped potential and
look forward to seizing the opportunities they present as we deepen
our global presence.

Figure 4

Net revenue per region (in EUR millions).

23% 27% 25% 5%

491.0

399.4

242.0

190.7

98.0
78.2
53.4 56.0

EMEA North America Asia-Pacific Latin America

H2 2022 H2 2023 2

2
On a constant currency basis, net revenue of €887.0 million would have been 3% higher than
reported. Please refer to Note 1 of the Interim Condensed Consolidated Financial Statements for
further detail on revenue breakdown.
Shareholder letter H2 2023 22

Reaching our team's next stage of maturity as

we conclude our accelerated investment
Operating expenses were €491.3 million in H2 2023, up 8% from H1 2023
and 27% YOY. These increases were largely driven by investments in
growing our global team as we prepare to further scale Adyen.
Employee benefits were €308.1 million in H2 2023, up 39% YOY. This figure
reflects this year's continued investment in scaling the Adyen team. We
welcomed 313 new joiners in H2, which brought us to a total of 4,196 FTEs
at the year's end. As previously communicated, the tempering of our hiring
will allow our operating leverage to again become visible in our financials.
Though this process will begin in 2024, the operational impact will be
limited as 2023 hires annualize, followed by more material leverage in
2025 and 2026.
In other operating expenses, we remain committed to pledging 1% of our
net revenue to initiatives that support the UN SDGs. In H2, this amount
totaled €8.9 million. This contribution is in the process of going towards
nonprofit partnerships including UNICEF, Plan International, UNHCR,
and the WWF.
Sales and marketing expenses totaled €25.6 million in H2 2023, down 18%
YOY. While 2022 was a year of scaling our media distribution and
production initiatives, in 2023, we found opportunities to hone these lead
generation activities for greater impact. H2 saw us deliberately optimize our
preferred marketing formats, media distribution channels, and production.
Across teams, we became increasingly effective at creating profitable return
through targeted marketing activities, while reducing costs along the way.
Shareholder letter H2 2023 23

EBITDA margin reflects intentionally and

gradually slowed hiring pace
EBITDA was €423.0 million in H2 2023, up 14% from €372.0 million in H2
2022. This figure was primarily impacted by team growth, which tempered
as our accelerated investment initiative came to a close. This period,
inventory write-offs had a €17.0 million negative impact on EBITDA. During
COVID, we navigated significant supply chain shortages by ordering backup
terminals with non-optimal specifications, solely to ensure significant stock
to fulfil strong demand. Our terminal range has since evolved, leaving us
with overstock for certain device types, which we have written off.
EBITDA margin was 48% in H2 2023, compared to 43% in H1 2023.
Building our team over the last two years was counter-cyclical compared to
much of the industry – a decision enabled by the profitable business we
have built and the flexibility it allowed.

Net income
Net income was €416.1 million for the period, up 48% YOY. We generated
significant interest income of €153.0 million in the period, primarily
stemming from our balances at central and commercial banks.

CapEx down in H2 following front-loaded

investments
CapEx was €13.7 million, and 2% of net revenue, down from 8% of net
revenue in H1 2023. As communicated in previous letters, our data center
investments are not always linear or balanced throughout the year, but
rather executed in line with our technical needs. With our high infrastructure
and facilities costs front-loaded in H1 2023, this period was able to return
below expectations.

Healthy free cash flow conversion

Free cash flow was €391.8 million in H2 2023, up 31% YOY. Free cash flow
conversion ratio was 93%.
Shareholder letter H2 2023 24

Financial objectives
We did not see any business developments over the second half of 2023
that would lead us to update our guidance. Our standing financial objectives
therefore remain unchanged.

Net revenue growth: We aim to continue to grow net revenue between the
low-twenties and high-twenties percent, up to and including 2026.

EBITDA margin: We aim to improve EBITDA margin to levels above 50% in

2026, as we expect to benefit from operating leverage inherent to our
business model.
Capital expenditure: We aim to maintain a sustainable capital expenditure
level of up to 5% of our net revenue.
We will be broadcasting a live video conference hosted by Ingo Uytdehaage
(Co-CEO) and Ethan Tandowsky (CFO) to discuss these results at 3PM CET
today. You can follow the livestream at www.adyen.com/ir. A recording will
be made available on our investor relations website following the call.
Sincerely,

P.W. van der Does I.J. Uytdehaage E.L. Tandowsky

Co-founder and Co-CEO Co-CEO CFO
Shareholder letter H2 2023 25

Interim Condensed Consolidated

Financial Statements
H2 2023 Adyen N.V.
Shareholder letter H2 2023 26

Consolidated statement of comprehensive income

For the six months ended December 31, 2023 and 2022
(all amounts are in EUR thousands unless otherwise stated)

Note H2 2023 H2 2022

Revenue 1 1,009,856 4,988,130
Costs incurred from financial institutions 1 (73,402) (4,237,691)
Costs of goods sold 1 (49,500) (28,802)
Net revenue 886,954 721,637

Wages and salaries 3 (267,020) (193,372)

Social securities and pension costs 3 (41,066) (28,710)
Amortization and depreciation 11,12 (44,529) (38,222)
Other operating expenses 4 (138,661) (127,460)
Other expenses 2 (17,189) (63)
Income before net finance income and income taxes 378,489 333,810

Finance income 9 152,993 27,830

Finance expense (2,492) (3,191)
Other financial results 5 40,601 1,861
Net finance income 191,102 26,500

Income before income taxes 569,591 360,310

Income taxes 6 (153,442) (78,308)
Net income for the period 416,149 282,002
Net income attributable to owners of Adyen N.V. 416,149 282,002

Other comprehensive income

Items that may be reclassified to profit or loss
Currency translation adjustments foreign operations (2,402) (4,981)
Other comprehensive income for the period (2,402) (4,981)

Total comprehensive income for the period

413,747 277,021
(attributable to owners of Adyen N.V.)

Earnings per share (in EUR)

Net profit per share - Basic 13 13.42 9.10
Net profit per share - Diluted 13 13.36 9.08

The accompanying notes are an integral part of these interim condensed consolidated financial statements.
Shareholder letter H2 2023 27

Consolidated balance sheet

As at December 31, 2023 and 2022
(all amounts are in EUR thousands unless otherwise stated)

Note December 31, 2023 December 31, 2022

Intangible assets 8,757 8,140

Plant and equipment 11 165,136 140,796
Right-of-use assets 12 199,663 181,676
Other financial assets at FVPL 10 14,821 12,264
Contract assets 1.1 24,195 48,612
Deferred tax assets* 6 112,679 147,665
Total non-current assets 525,251 539,153

Inventories 2 104,502 87,891

Receivables from merchants and financial institutions 490,052 369,104
Trade and other receivables 134,274 89,350
Current income tax receivables 6 7,310 12,445
Cash and cash equivalents 9 8,306,982 6,522,345
Total current assets 9,043,120 7,081,135
Total assets 9,568,371 7,620,288

Share capital 7 310 310

Share premium 7 390,043 352,399
Other reserves 159,232 156,552
Retained earnings* 2,610,044 1,906,795
Total equity attributable to owners of Adyen N.V. 3,159,629 2,416,056

Derivative liabilities 10 1,400 35,000

Deferred tax liabilities 6 6,455 11,345
Lease liability 12 172,397 169,873
Cash-settled share-based payment plan 3.2 1,563 6,742
Total non-current liabilities 181,815 222,960

Payables to merchants and financial institutions 5,942,035 4,795,804

Trade and other payables 168,396 147,827
Lease liability 12 50,666 33,200
Current income tax payables 6 65,830 4,441
Total current liabilities 6,226,927 4,981,272
Total liabilities and equity 9,568,371 7,620,288

The accompanying notes are an integral part of these condensed consolidated financial statements.
*The comparative retained earnings and deferred tax assets balances are restated as a result of the application of IAS 12 amendment (refer to note 6.2).
Shareholder letter H2 2023 28

Consolidated statement of changes in equity

For the years ended December 31, 2023 and 2022
(all amounts are in EUR thousands unless otherwise stated)

Other reserves
Share-based Retained
Note Share capital Share premium Legal Warrant Total equity
payment earnings*
reserves reserve
reserve
Balance - January 1, 2022 (as previously reported) 310 335,725 9,740 102,142 25,575 1,336,922 1,810,414

Adjustment for change in accounting standard 6.2 3,938 3,938

Balance - January 1, 2022 (restated) 310 335,725 9,740 102,142 25,575 1,340,860 1,814,352

Net income for the year 564,139 564,139

Currency translation adjustments (1,326) (1,326)
Total comprehensive income for the year — — (1,326) — — 564,139 562,813

Adjustments:
Intangible assets (2,160) 2,160 —
Other adjustments 161 (364) (203)
— — (2,160) 161 — 1,796 (203)
Transactions with owners in their capacity as owners:

Deferred tax on share-based compensation 6 6,180 22,979 29,159

Options exercised 568 (568) —
Proceeds on issuing shares 7 — 9,926 9,926
Share-based payments 3.2 9 9
— 16,674 — 22,420 — — 39,094

Balance - December 31, 2022 310 352,399 6,254 124,723 25,575 1,906,795 2,416,056

*The comparative retained earnings balance is restated as a result of the application of IAS 12 amendment (refer to note 6.2).
Shareholder letter H2 2023 29

Other reserves
Share-based Retained
Note Share capital Share premium Warrant Total equity
Legal reserves payment earnings*
reserve
reserve
Balance - January 1, 2023 310 352,399 6,254 124,723 25,575 1,906,795 2,416,056

Net income for the year 698,322 698,322

Currency translation adjustments 790 790
Total comprehensive income for the year — — 790 — — 698,322 699,112

Adjustments:
Intangible assets 717 (717) —
Other adjustments 744 5,644 6,388
— — 717 744 — 4,927 6,388
Transactions with owners in their capacity as owners:
Share-based payment reclassification
Deferred tax on share-based compensation 6 11,196 (31,398) (20,202)
Options exercised 634 (634) —
Proceeds on issuing shares 7 — 13,201 13,201
Share-based payments 3.2 — 12,613 12,037 24,650
Reclassification of share-based payment plan 3.2 20,424 — 20,424
— 37,644 — 429 — — 38,073
Balance - December 31, 2023 310 390,043 7,761 125,896 25,575 2,610,044 3,159,629

The accompanying notes are an integral part of these condensed consolidated financial statements.
Shareholder letter H2 2023 30

Consolidated statement of cash flows

For the six months ended December 31, 2023 and 2022
(all amounts are in EUR thousands unless otherwise stated)

Note H2 2023 H2 2022

Income before income taxes 569,591 360,310
Adjustments for:
– Finance income 9 (152,993) (27,830)
– Finance expenses 2,492 3,191
– Other financial results 5 (40,601) (1,861)
– Other expenses 11 257
– Depreciation of plant and equipment 11 23,768 16,299
– Amortization of intangible fixed assets 1,732 3,569
– Depreciation of right-of-use assets 12 19,029 18,354
– Equity-settled share-based compensation 3.2 18,650 —
– Cash-settled share-based payment plan 3.2 (1,239) 2,671
Changes in working capital:
– Inventories 2 9,558 (33,479)
– Trade and other receivables (14,221) 7,782
– Receivables from merchants and financial institutions (67,577) (10,974)
– Payables to merchants and financial institutions 1,464,864 626,964
– Trade and other payables 7,599 10,891
– Amortization and additions of contract assets 1.1 13,475 13,085
Cash generated from operations 1,854,384 988,972

Interest received 9 152,993 27,830

Interest paid (2,492) (3,191)
Income taxes paid 6 (83,479) (3,120)
Net cash flows from operating activities 1,921,406 1,010,491
Redemption of financial assets at FVPL — 11,407
Purchases of plant and equipment 11 (12,645) (57,533)
Capitalization of intangible assets (1,003) (1,595)
Net cash used in investing activities (13,648) (47,721)
Proceeds from issues of shares 7 6,540 5,047
Lease payments 12 (17,564) (14,747)
Net cash flows from financing activities (11,024) (9,700)
Net increase in cash, cash equivalents and bank overdrafts 1,896,734 953,070
Cash, cash equivalents and bank overdrafts at beginning of the period 6,411,624 5,584,075
Exchange losses on cash, cash equivalents and bank overdrafts (1,376) (14,800)

Cash, cash equivalents and bank overdrafts at end of the period 8,306,982 6,522,345

The accompanying notes are an integral part of these interim condensed consolidated financial statements.
Shareholder letter H2 2023 31

Notes to the interim condensed consolidated financial statements

General information
Adyen N.V. (hereinafter ‘Adyen’, or 'the Company') is a licensed Credit Institution by De Nederlandsche Bank (the
Dutch Central Bank) and registered in the Netherlands under the company number 34259528. The Credit Institution
license includes the ability to provide cross-border services in the European Economic Area. Adyen N.V. directly or
indirectly owns 100% of the shares of its subsidiaries, and therefore controls all entities included in these interim
condensed consolidated financial statements. Adyen shares are traded on Euronext Amsterdam, where the
Company is part of the AEX Index and has a credit rating of A-, per S&P rating agency.
During the year, Adyen was granted a license to operate as a UK Foreign Branch in London, by the Prudential
Regulatory Authority (PRA) and Financial Conduct Authority (FCA). The London branch was registered as at 1
November 2023.
All amounts in the notes to the interim condensed consolidated financial statements are stated in thousands of EUR,
unless otherwise stated.

Basis of preparation
The interim condensed consolidated financial statements for the period July 1, 2023 to December 31, 2023 have
been prepared in line with the accounting and recognition principles included in the Adyen annual consolidated
financial statements of 2022, in accordance with International Financial Reporting Standards and IFRS IC
interpretations as endorsed by the European Union (EU-IFRS). This report should, therefore, be read in conjunction
with the 2022 annual consolidated financial statements, as well as our H1 2023 interim condensed consolidated
financial statements.
The following periods have been presented for the interim condensed consolidated financial statements ended
December 31, 2023:

Interim condensed consolidated financial statements Current period Comparative period

Statement of comprehensive income July 1 - December 31, 2023 July 1 - December 31, 2022

Balance sheet As at December 31, 2023 As at December 31, 2022

Statement of changes in equity January 1 - December 31, 2023 January 1 - December 31, 2022

Statement of cash flows July 1 - December 31, 2023 July 1 - December 31, 2022

Relevant accounting policies

Significant and other accounting policies that summarize the measurement basis used, and are relevant to
understanding the financial statements, are provided in the annual consolidated financial statements for the year
ended December 31, 2022. Any significant accounting policy changes during the last six months of 2023 are
reflected throughout the notes to these interim condensed consolidated financial statements.
Shareholder letter H2 2023 32

Significant accounting estimates or judgements

A number of accounting policies involve a higher degree of judgement or complexity, which are more likely to be
materially adjusted due to inaccurate estimates and or assumptions applied. The areas involving significant
estimates or judgments are:
• Principal versus agent for revenue out of settlement fees – refer to note 1 ‘Revenue and segment reporting'.
During H1 2023, Adyen amended its terms and conditions applicable to merchant agreements in order to specify
the responsibilities of the services provided by financial institutions and network scheme providers involved in the
payment processing and acquiring services. As a result, Adyen reassessed its key accounting judgment in relation
to pass-through settlement fees (namely; interchange and payment network fees), and concluded it acts as agent
in this arrangement. This change in terms and conditions resulted in a prospective accounting change, effective
from January 1, 2023, whereby pass-through settlement fees are recognized on a net (agent) basis (i.e. no longer
recognized gross in revenue and costs incurred from financial institutions). This change impacts the 'Revenue' and
'Costs incurred from financial institutions' lines in the statements of comprehensive income, with no change to net
revenue. This change does not impact the 2022 comparative results, the non-IFRS financial measures or
guidance.
• Realization of deferred taxes related to share-based compensation – refer to note 6 ‘Income taxes’.
• Fair value accounting of financial liabilities – refer to note 10 ‘Financial instruments’.

New standards adopted by Adyen

The accounting policies and methods of computation adopted in the preparation of the interim condensed
consolidated financial statements are consistent with those followed in the preparation of the Adyen annual
consolidated financial statements for the year ended December 31, 2022.
Adyen has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective.
A number of new or amended standards became applicable for the current reporting period. Adyen made a
retrospective adjustment as a result of new amendments to the IAS 12 accounting standard made applicable on
January 1, 2023, as disclosed in note 6.2 'Deferred income taxes'.
The qualitative impact assessment of the first-time application on January 1, 2023 of new amendments is disclosed
in note 16 ‘New and amended standards adopted by Adyen’.
Shareholder letter H2 2023 33

Key disclosures
1. Revenue and segment reporting
The company derives revenue from settling and processing payments, sales of goods such as the sale of point-of-
sale (POS) terminals, and other payment specific services.
The breakdown of revenue from contracts with customers per type of goods or service is as follows:

Types of goods or service (in EUR'000) H2 2023 H2 2022

Settlement fees 596,209 4,629,276
Processing fees 251,220 207,549
Sales of goods 42,955 27,537
Other services 119,472 123,768
Total revenue from contracts with customers 1,009,856 4,988,130
Costs incurred from financial institutions (73,402) (4,237,691)
Costs of goods sold (49,500) (28,802)
Net revenue 886,954 721,637

Key Judgement – Principal versus agent for revenue out of settlement fees
Adyen contracts with third parties (financial institutions and network scheme providers) that provide
services to enable Adyen’s payment processing and acquiring services to merchants, for which
interchange and payment network fees are charged to Adyen ("pass-through settlement fees"). Adyen
adopts a transparent pricing model and charges fees to merchants based on its own incurred costs
(including interchange and payment network fees charged to merchants in a pass-through
arrangement), plus a mark-up which is disclosed as "Settlement fees".
Adyen applies its judgment in determining whether it has control of the full payment service before the
service is transferred to its merchants, and, in consequence, whether it is acting as agent or principal in
relation to the settlement fees charged to merchants. Where Adyen is principal, it will present its
acquiring mark-up and interchange and payment network fees passed on to merchants on a gross
(principal) basis within revenue. Where Adyen is agent, it will present its acquiring mark-up on a gross
(principal) basis, while the pass-through settlement fees will be presented within revenue on a net basis
(i.e. not recognized gross in revenue and costs incurred from financial institutions).

Based on facts and circumstances up to December 31, 2022, Adyen was considered primarily responsible for
fulfilling the promise to provide payment transaction services, and therefore had control over the full settlement
service before the service is transferred to merchants. As such, Adyen retained the exposure to financial institutions
and payment networks for the interchange and payment network fees, other costs incurred from financial
institutions, and therefore acted as Principal for the aforementioned fees.
In 2023, Adyen amended its terms and conditions applicable to merchant agreements in order to specify the
responsibilities of the services provided by financial institutions and network scheme providers involved in the
payment processing and acquiring services. The change in terms and conditions specifies the distinct services
provided in the payment flow, clarifying that Adyen does not provide a significant service of integrating the services
from third parties into one combined output for the merchant, nor does it control the inputs from third parties before
services are provided to the merchant. As such, Adyen acts as agent for the pass-through settlement fees
prospectively from January 1, 2023.
Shareholder letter H2 2023 34

The breakdown of revenue from contracts with customers based on timing is as follows:

Timing of revenue recognition (in EUR'000) H2 2023 H2 2022

Goods and services transferred at a point in time 1,001,930 4,981,554
Services transferred over time 7,926 6,576
Total revenue from contracts with customers 1,009,856 4,988,130

Net revenue
The Management Board monitors net revenue as a performance indicator. Adyen considers net revenue to provide
additional insight to its users to evaluate the nature and financial effects of the business activities in which it engages
and the economic environments in which it operates. Net revenue is a non-IFRS measure – refer to note 1.3 for
further explanation on the non-IFRS measures reported by Adyen.

1.1 Contract assets

In 2018, Adyen entered into a long-term contract with eBay for the provision of payment services that resulted in the
initial recognition of contract assets settled with a cash advance and issue of warrants over Adyen’s shares. The
monetary component was fully repaid and amortised in H1 2022. In addition, refer to note 10 ‘Financial instruments’
for more information on the warrants (derivative liabilities).
Contract assets mainly relate to integration and development fees that are directly incremental to obtain the multi-
year contracts and do not represent a separate performance obligation. Adyen will amortize these costs (i.e. non-
monetary component) against revenue (settlement fees) on a pro rata basis as the related revenue is recognized.
Adyen entered into no further contracts during 2023.
The following table summarizes the movement in the contract assets balance:

Contract assets Non-monetary component Other contract assets Total contract assets

Balance - 1 July, 2022 53,216 8,570 61,786

Movements:

Additions — —
Amortization for the period (11,552) (1,533) (13,085)
Exchange differences (89) (89)
Balance - December 31, 2022 41,664 6,948 48,612

Balance - 1 July, 2023 32,013 5,700 37,713

Movements:
Additions — —
Amortization for the period (12,284) (1,191) (13,475)
Exchange differences — (43) (43)
Balance - December 31, 2023 19,729 4,466 24,195
Shareholder letter H2 2023 35

1.2 Segment reporting

The following table summarizes Adyen’s geographical breakdown of its revenue, based on the billing location as
requested by the merchant for the periods indicated.

Revenue - Geographical breakdown H2 2023 H2 2022

Europe, the Middle East, and Africa (EMEA) 558,906 1,900,111
North America 275,930 2,405,179
Asia-Pacific 111,526 445,117
Latin America 63,494 237,723
Total revenue from contracts with customers 1,009,856 4,988,130

1.3 Non-IFRS financial measures

Non-IFRS financial measures are disclosed in addition to the statement of comprehensive income, in order to
provide relevant information to better understand the underlying business performance of the Company.
Furthermore, Adyen has provided guidance on several of these non-IFRS measures as described in the 'Financial
objectives' section. Adyen reports on the following additional financial measures that are directly derived from the
statement of comprehensive income or statement of cash flows:
– Net revenue: "Revenue" less "Costs incurred from financial institutions" and "Costs of goods sold";
The geographical breakdown of net revenue and related year-on-year growth is as follows (based on the billing
location as requested by the merchant for the periods indicated).

Net revenue - Geographical breakdown and year-on-year

H2 2023 YoY% H2 2022 YoY%
growth
Europe, the Middle East, and Africa (EMEA) 490,954 23 % 399,436 20 %
North America 242,045 27 % 190,689 45 %
Asia-Pacific 97,978 25 % 78,109 44 %
Latin America 55,977 5% 53,403 36 %
Total net revenue from contracts with customers 886,954 23 % 721,637 30 %

– EBITDA: “Income before net finance income and income taxes” less “Amortization and depreciation” on the
consolidated statement of comprehensive income;
– EBITDA margin: EBITDA as a percentage of "Net revenue" on the consolidated statement of comprehensive
income;
– CapEx: Capital expenditures consisting of the line items "Purchases of plant and equipment" and "Capitalization
of intangible assets" on the consolidated statement of cash flows;
– Free cash flow: EBITDA less CapEx and “Lease payments” on the consolidated statement of cash flows; and
– Free cash flow conversion ratio: free cash flow as a percentage of EBITDA.
Shareholder letter H2 2023 36

Selected non-IFRS financial measures H2 2023 H2 2022

Income before net finance income and income taxes 378,489 333,810
Amortization and depreciation 44,529 38,222
EBITDA 423,018 372,032

Net revenue 886,954 721,637

EBITDA margin (%) 48 % 52 %

Purchases of plant and equipment 12,645 57,533

Capitalization of intangible assets 1,003 1,595
CapEx 13,648 59,128

EBITDA 423,018 372,032

CapEx (13,648) (59,128)
Lease payments (17,564) (14,747)
Free cash flow 391,806 298,157

Free cash flow 391,806 298,157

EBITDA 423,018 372,032
Free cash flow conversion ratio (%) 93 % 80%

2. Inventories

Inventories H2 2023 H2 2022

Balance - July 1 120,329 54,412
Purchases during the year (products for resale) 59,205 62,936
Costs of goods sold (49,500) (28,802)

Transfer to plant and equipment (note 11) (6,269) —

Expense recognized in other expenses (19,263) (655)
Balance - December 31 104,502 87,891

During H2 2023, inventory of EUR 6,269 in Brazil was reclassified to plant and equipment (note 11) as the POS
terminals are being held for rental to merchants instead of being sold in the ordinary course of business.
As a result of the net realizable value assessment, Adyen recognized inventory write-offs of EUR 17,024 (2022: EUR
380), included in 'Other expenses', driven by overstock purchases made during supply chain disruptions. Adyen
recognised inventory price variances of EUR 2,239 in ‘Other operating expenses’ (2022: EUR 770) related to
purchases of POS terminals from resellers at higher than standard price.
 Shareholder letter H2 2023 37

3. Employee benefit expense

3.1 Employee benefits

The breakdown of FTE per office as at December 31, 2023 and 2022 is as follows:

FTE per office December 31, 2023 December 31, 2022

Amsterdam 2,326 1,941

San Francisco 299 270
New York 186 139
São Paulo 170 146
Singapore 165 127
Chicago 155 53
Madrid 133 64
London 133 123
Paris 96 75
Berlin 91 67
Other 442 327

Total 4,196 3,332

The employee benefits expense can be specified as follows:

Employee benefits H2 2023 H2 2022
Salaries and wages 248,224 183,716
Share-based compensation 18,796 9,656
Total wages and salaries 267,020 193,372

Social securities 33,931 23,955

Pension costs - defined contribution plans 7,135 4,755
Total social securities and pension costs 41,066 28,710

3.2 Share-based payments

The share-based compensation expense can be specified as follows:
Share-based compensation H2 2023 H2 2022
Equity-settled 18,650 —
Cash-settled 146 9,656
Total share-based compensation 18,796 9,656

Adyen considers its employees and culture as core to its growth. As part of the total remuneration package, Adyen
has four types of compensation plans:
I. Equity-settled option plan (granted until 2018);
II. Cash-settled share-based payment plan (granted from 2018 to May 2023);
III. Depositary receipts award plan for directors and employees (granted from 2018 to December 2023) and the
Fixed Salary shares plan (granted from December 2023 onwards) - presented in salaries and wages; and
IV. Restricted Stock Unit (“RSU”) awards plan (granted from 2023 onwards).
Shareholder letter H2 2023 38

Cash-settled share based payment plan

The decrease in cash-settled share-based compensation expense in H2 2023 was mainly linked to the Adyen share
price decrease over the period and the introduction of the RSU awards plan.
The nature, accounting policies and key parameters of the equity and cash-settled plans are described in more detail
in the 2022 annual consolidated financial statements.

Depositary receipts award plan and Fixed Salary shares plan

Adyen has granted the possibility to purchase Depositary Receipts at fair market value to directors and to employees
as part of their remuneration from 2018 until December 2023. The underlying shares of Adyen are held by an
administration foundation that, in turn, issues the Depositary Receipts to the employees. Each Depositary Receipt
issued represents the economic interest of one underlying STAK (“Stichting Administratie Kantoor Adyen N.V.")
share.
From December 2023 Adyen has introduced the Fixed Salary shares plan which replaces and supersedes the
Depositary receipts awards plan, and grants the possibility to purchase Adyen N.V. ordinary shares at fair market
value to directors and to employees as part of their remuneration.
The related employee benefits expense for H2 2023 amounted to EUR 6,372 (2022: EUR 5,400) and is presented in
wages and salaries. The fair value of the liability recognized resulting from the plan is EUR 507 (2022: EUR 484), and
the plan resulted in a total increase of EUR 5,769 (2022: 4,419) recognized in share capital and share premium
during the period. There is a lock-up period but no vesting condition attached to the Depositary Receipts awards plan
and Fixed Salary shares plans. There was no revised estimate of the number of Adyen N.V. ordinary shares expected
to vest or relating income statement impact in 2023.

Restricted Stock Unit Awards plan

During H1 2023, Adyen introduced the equity-settled RSU awards plan for newly hired directors and employees as
well as certain current employees. The RSU plan replaced the cash-settled share-based payment plan for new joiners
and provided existing plan participants an opportunity to convert to the RSU plan. The number of RSUs granted is
determined by dividing the award value against the closing Adyen share price on the first business day of the relevant
calendar month. A participant has no voting rights, meeting rights, dividend rights or any other rights before the
RSUs have vested. RSUs are converted into ordinary Adyen shares when they vest.
Subject to the employee’s continued employment with Adyen N.V., the RSUs will vest over a period of four years from
the grant date. 25% of the RSUs will vest on each anniversary of the grant date, until all are vested after four years.
Shares granted under this plan are not subject to any performance conditions, the only applicable vesting condition
is a service condition throughout the vesting period. The RSUs are measured at fair value at grant date, which is
equal to the Adyen share price at that date, and are expensed over the vesting period based on the Company’s
estimate of the number of RSUs that are expected to vest, with a corresponding increase in 'Share-based payment
reserve' within shareholders’ equity.
The RSU plan resulted in an expense of EUR 18,650 recognized in wages and salaries for the period.
Shareholder letter H2 2023 39

4. Other operating expenses

The other operating expenses can be specified as follows:
Other operating expenses (in EUR '000) H2 2023 H2 2022
Travel and other staff expenses 28,801 28,389
Sales and marketing costs 25,611 31,384
IT costs 23,037 17,018
Advisory costs 12,109 17,076
Housing costs 9,035 6,383
1% for the UN SDGs 8,870 7,217
Contractor costs 6,773 7,159
Office costs 6,104 4,884
Miscellaneous operating expenses 18,321 7,950
Total other operating expenses 138,661 127,460

As part of Adyen's sustainability efforts in H2 2023, EUR 8,870 represented the 1% of net revenue pledge towards UN
Sustainable Development Goals (SDG's). These contributions are in the process of going towards charitable
partnerships including UNICEF, Plan International, UNHCR and the WWF.
Sales and marketing costs decreased as a result of optimizing our preferred targeted marketing activities, reducing
costs along the way. In addition, miscellaneous operating costs increased due to higher accounts receivable loss
allowance provisions (note 10) and inventory price variances (note 2).

5. Other financial results

The other financial results can be specified as follows:
Other financial results H2 2023 H2 2022
Exchange gains/(losses) 1,131 (14,061)
Fair value re-measurement of financial instruments:
Derivative liabilities 38,137 14,000
Other financial assets at FVPL 1,333 1,922
Total other financial results 40,601 1,861

Exchange gains during H2 2023 mainly relate to exchange gains from Adyen’s foreign denominated cash balances.
The change in fair value of the derivative liabilities in H2 2023 was mainly driven by the revision of valuation inputs
related to time to maturity and likelihood of vesting as well as Adyen's share price decrease over the period. More
information on the valuation of the derivative liabilities is disclosed in note 10 ‘Financial instruments’.

6. Income taxes

6.1 Income tax expense

The tax on Adyen’s income before income taxes differs from the amount that would arise using the statutory tax rate
in the Netherlands. The effective tax rate of Adyen for the six months ended December 31, 2023 is 26.94%
(December 31, 2022: 21.73%) which differs from the statutory tax rate in the Netherlands of 25.80% (2022: 25.80%)
due to other adjustments (such as prior year and non-deductible expenses), which was partially offset by the
application of the innovation box and tax rate differences on foreign operations. The increase in finance income,
which does not benefit from the innovation box regime, is a substantial driver of the increased effective tax rate in H2
2023. The innovation box is a Dutch tax incentive whereby a portion of qualifying taxable profits derived from
Shareholder letter H2 2023 40

innovative activities are taxed at a lower rate than the headline corporate tax rate in the Netherlands, thereby
reducing the effective tax rate.
Effective tax calculation H2 2023 H2 2022
Income before income taxes 569,591 360,310
Statutory tax rate in the Netherlands (%) 25.80% 25.80%
Income taxes based on statutory tax rate in the Netherlands 146,954 92,960

Tax effects of:

Innovation box (12,263) (21,913)

Tax rate differences on foreign operations (4,402) 8,225

Other adjustments (such as prior period and non-deductible

23,153 (964)
amounts)
Effective tax amount 153,442 78,308

Current income tax receivables/(payables) December 31, 2023 December 31, 2022
Current income tax receivables 7,310 12,445
Current income tax payables (65,830) (4,441)

Income tax expense in the statement of comprehensive income can be specified as follows:
Income taxes H2 2023 H2 2022
Current income tax expense 148,141 79,856
Deferred income tax expense/(income) 5,301 (1,548)
Total income taxes 153,442 78,308
Shareholder letter H2 2023 41

6.2 Deferred income taxes

Deferred tax assets

In the deferred tax assets, an amount of EUR 361 (December 31, 2022: EUR 9,030) relates to the recognized
derivative liabilities. The decrease in the related deferred tax asset is caused by the decrease in fair value of the
derivative liability (refer to note 10 for further details).
Change in accounting standard
In accordance with the amendments to 'IAS 12 - Deferred tax related to assets and liabilities arising from a single
transaction', Adyen has recognized EUR 3,938 of deferred tax assets related to right-of-use assets and lease
liabilities. The cumulative effect is recognized as an adjustment to the retained earnings opening balance and the
deferred tax asset balance as at December 31, 2021.
Deferred tax assets that rely on future profitability
Deferred tax assets include tax losses carried forward relating to options exercised in the United States at a Federal
and State level (December 31, 2023: EUR 85,910; December 31, 2022: EUR 115,121) and windfall benefits relating
to options granted and vested, however not yet exercised (December 31, 2023: EUR 2,519; December 31, 2022: EUR
5,325). The balance as at December 31, 2022 included tax losses carried forward in the United Kingdom which was
fully utilized in the current year. In 2023, an amount of EUR 11,196 of the tax losses carried forward was utilized and
recognized in the share premium reserve (2022: EUR 6,180), with a further decrease of EUR 14,042 relating to an
update of the (historic) apportionment of taxable profit on a State level due to legislative changes causing a change in
estimate, resulting in a revaluation of the tax losses at a State level, recognised directly in equity.
Throughout the period Adyen has reassessed the recoverability of deferred tax assets on windfall benefits linked to
the share-based compensation plan in the United States. Adyen continues to recognize deferred tax assets that will
be realized against future profits, on a going concern basis.
The United States Federal Tax windfall benefit continues to be recognized as these carry forward losses have no
expiration date. The State net operating losses continues to be recognized as these carry forward losses are
expected to be utilized against future taxable income before its expiration date.
The movement in deferred tax assets relating to windfall benefits and carry forward losses was recognized directly in
equity.

Deferred tax liabilities

The deferred tax liabilities consist mainly of the deferred tax on the non-monetary part of the contract asset of EUR
5,090 (December 31, 2022: EUR 10,749).
The deferred taxes are presented as non-current on the balance sheet.
Shareholder letter H2 2023 42

Capital management and financial instruments

7. Capital management
Adyen’s objective when managing capital is to safeguard its ability to continue as a going concern. Furthermore,
Adyen ensures that it meets regulatory capital requirements at all times.
Capital management (in EUR '000) December 31 , 2023 December 31 , 2022

Share capital 310 310

Share premium 390,043 352,399
Total 390,353 352,709

In 2023, 46,799 (December 31, 2022: 29,213) additional shares were issued. The additional issued shares were a
result of exercises of options granted to employees, share issuance relating to the Depositary receipts award plan
and Fixed Salary shares plan and vesting of shares granted to employees relating to the RSU plan (refer to note 3.2
for further information). The number of outstanding ordinary shares as of December 31, 2023 is 31,033,098
(December 31, 2022: 30,986,299) with an absolute nominal value EUR 0.01 per share. The total number of
authorized shares as of December 31, 2023 is 80,000,000 (December 31, 2022: 80,000,000).
The following reserves are considered to be non-distributable: legal reserves (in accordance with Dutch Law), share-
based payment reserve, warrant reserve, and total comprehensive income for the current period. The total of
distributable reserves as at December 31, 2023 amounts to EUR 2,302,075 (December 31, 2022: EUR 1,691,427).
The legal reserves restricted for distribution in accordance with Dutch Law as at December 31, 2023 amounts to EUR
22,582 (December 31, 2022: EUR 18,518).
Net income is added to retained earnings reserve and the current dividend policy is to not pay dividends, as retained
earnings are used to support and finance the growth strategy.

8. CRR/CRD IV Regulatory Capital

The following table shows the calculation of regulatory capital as at December 31, 2023. The regulatory capital is
based on the CRR/CRD IV scope of consolidation, which is the same as the IFRS scope of consolidation as included
in the annual consolidated financial statements.

Own funds (in EUR '000) December 31, 2023 December 31, 2022

EU-IFRS equity as reported in consolidated balance sheet* 3,159,629 2,416,056

Net profit not included in CET1 capital (H2 2023 not yet eligible) (416,149) (282,002)
Regulatory adjustments:
Warrant reserve (25,575) (25,575)
Intangible assets (8,757) (8,140)
Deferred tax assets that rely on future profitability (90,985) (124,162)
Prudent valuation (16) (47)
Total own funds 2,618,147 1,976,130

The increase in total own funds in 2023 mainly relates to the additions of consolidated net profit (full year 2022 and
H1 2023).

*The comparative retained earnings balance is restated as a result of the application of IAS 12 amendment (refer to note 6.2).
Shareholder letter H2 2023 43

9. Cash and cash equivalents

Cash and cash equivalents (in EUR ‘000) December 31, 2023 December 31, 2022

Cash held at central banks 5,863,231 4,407,540

Cash held at banks, other than central banks 2,443,751 2,114,805
Total 8,306,982 6,522,345

The "Cash held at central banks" and "Cash held at banks, other than central banks" earned interest in the amount of
EUR 116,912 and EUR 35,787 (during the six month ended December 31, 2022: EUR 11,564 and EUR 16,091)
respectively during the period, due to the rising interest rates in a positive interest rate environment, which was
recognized in finance income.
Of the "Cash held at banks, other than central banks", EUR 88,860 ( December 31, 2022: EUR 68,564) are restricted
and are therefore not available for general use by the Company. The restricted cash mainly relates to deposits
required under the US Federal Foreign Branch license, Brazilian acquiring license, as well as deposits held as
guarantee for leased offices. The restricted cash is readily convertible and therefore classified as cash and cash
equivalents.

10. Financial instruments

Other financial assets at fair value through profit or loss (‘FVPL’) (Visa Inc. preferred shares)
Adyen has recognized and classified the convertible (‘Series C’) preferred Visa Inc. shares within the FVPL category.
The balance of other financial assets at FVPL as per December 31, 2023 is EUR 14,821 (December 31, 2022: EUR
12,264). The fair value of the level 2 preferred shares in Visa Inc. is based on the quoted price of Visa Inc. common
shares, adjusted for lack of marketability, multiplied by an initial conversion rate of preferred shares into common
shares. The conversion rate may fluctuate in the future. The adjustment for lack of marketability is determined using
an option pricing model technique which relies on observable market data of the underlying Visa Inc. common
shares, as well as a presumed length of holding period restriction on the preferred shares.
The Visa Inc. preferred shares carry the right to receive discretionary dividend payments presented as other
expenses in the statement of comprehensive income (during the six months ended December 31, 2023: EUR 61, and
during the six month ended December 31, 2022: EUR 44).

Financial assets impairment

During the six months ended December 31, 2023, Adyen added EUR 4,699 (during the six month ended
December 31, 2022: released EUR 2,043) to (from) its trade receivable loss allowance based on the calculations from
its IFRS 9 expected credit loss model for trade receivables. The expected credit loss model which was updated in
December 31, 2022 still reflects reasonable and supportable information available on credit risk of the trade
receivables balance. During the six months ended December 31, 2023, Adyen wrote off trade receivables balances
for an amount of EUR 321 (during the six month ended December 31, 2022: EUR 917). Adyen did not reverse any
impairment losses in the last six months of 2023 and 2022.

Derivative liabilities (warrants)

As part of the long-term merchant contract previously mentioned (note 1.1), Adyen recognized derivative liabilities
measured at fair value through profit or loss, classified as a level 2 fair value instrument. Fair value remeasurements
are presented in other financial results (note 5).
The warrants vest in four tranches, each linked to a milestone of processed payments volume. Each milestone is
deemed achieved at the moment that the processed merchant volume exceeds the milestone amount in a single
calendar year following the Issue date (January 31, 2018). Only two warrant tranches may vest in a single calendar
Shareholder letter H2 2023 44

year, and upon vesting, each entitles the warrant holder to acquire 1.25% of Adyen’s issue-date diluted share volume
at any time prior to the warrant expiration date (January 31, 2025).
The derivative liabilities are valued using a Black-Scholes-Merton option pricing model (“OPM”) technique. The OPM
takes into consideration various observable market and contractual data as well as management estimates, including
the probability of vesting based on achievement of milestones in line with the fulfilment of the payment services to be
provided to the merchant.
The derivative liabilities balance as per December 31, 2023 is EUR 1,400 (December 31, 2022: EUR 35,000).
The change in fair value of the derivative liabilities during H2 2023 was mainly driven by the revision of valuation
inputs related to time to maturity and likelihood of vesting as well as Adyen's share price decrease over the period.
Adyen carried out a sensitivity analysis of the derivative liabilities with respect to the Adyen share price, noting that a
5% change in the underlying Adyen share price would result in an change of approximately 5% (EUR 0 million) (2022:
5% (EUR 2 million)) of the value of the derivative liabilities, all other circumstances considered equal.
No tranche milestones were met, or vested, and no related warrants were exercised during H2 2023.
Shareholder letter H2 2023 45

Other disclosures
11. Plant and equipment
Computer
Leasehold
Plant and equipment Hardware and Other Total
Improvements
Software
H2 2022
Cost 132,680 24,367 6,074 163,121
Accumulated depreciation (52,789) (6,687) (1,682) (61,158)
Balance - July 1, 2022 79,891 17,680 4,392 101,963

Additions 50,892 6,276 365 57,533

Disposals (100) — — (100)
Depreciation for the period (13,155) (2,765) (379) (16,299)
Other changes (e.g. exchange differences) (761) 37 (1,577) (2,301)
Balance - December 31, 2022 116,767 21,228 2,801 140,796

Cost 178,707 31,774 5,244 215,725

Accumulated depreciation (61,940) (10,546) (2,443) (74,929)
Balance - December 31, 2022 116,767 21,228 2,801 140,796

H2 2023
Cost 224,695 34,233 5,841 264,769
Accumulated depreciation (77,870) (13,545) (2,852) (94,267)
Balance - July 1, 2023 146,825 20,688 2,989 170,502

Additions 9,732 2,186 727 12,645

Disposals (253) (32) (28) (313)
Depreciation for the period (20,312) (2,959) (497) (23,768)
Transfer from inventory — — 6,269 6,269
Other changes (e.g. exchange differences) (193) (28) 22 (199)
Balance - December 31, 2023 135,799 19,855 9,482 165,136

Cost 216,513 36,064 12,745 265,322

Accumulated depreciation (80,714) (16,209) (3,263) (100,186)
Balance - December 31, 2023 135,799 19,855 9,482 165,136

Computer Hardware and Software additions during the six months ended December 31, 2023 mainly relate to
servers for data centers. During H2 2023, inventory (note 2) of EUR 6,269 in Brazil was reclassified to plant and
equipment as the POS terminals are being held for rental to merchants instead of being sold in the ordinary
course of business.
Adyen did not recognize an impairment loss or reverse any impairment loss on plant and equipment during the six
months ended December 31, 2023 and 2022.
Shareholder letter H2 2023 46

12. Leases
Adyen’s leases relate to offices and data centers across locations where it operates.
Right-of-use assets H2 2023 H2 2022
Offices and data centers
Cost 269,756 210,263
Accumulated depreciation (84,551) (51,013)
Balance - July 1 185,205 159,250

Additions 34,075 40,703

Depreciation for the period (19,029) (18,354)
Other movements (e.g. exchange differences) (588) 77
Balance - December 31 199,663 181,676

Recognized right-of-use assets 299,080 249,760

Accumulated depreciation (99,417) (68,084)
Balance - December 31 199,663 181,676

Lease liability H2 2023 H2 2022

Balance - July 1 207,121 175,812
Additions 34,075 40,703
Lease installments (19,851) (16,538)
Interest expense 2,287 1,791
Other movements (e.g. exchange differences) (569) 1,305
Balance - December 31 223,063 203,073
Current portion 50,666 33,200
Non-current portion 172,397 169,873

13. Share information

Adyen presents basic and diluted earnings per share (EPS) data for its ordinary shares. The calculation of earnings
per share is as follows:
1) Basic EPS: dividing the net income attributable to owners of Adyen N.V. by the weighted average number of
ordinary shares outstanding during the period.
2) Diluted EPS: determined by adjusting the basic EPS for the effects of all dilutive potential ordinary shares,
which in the case of Adyen relates to share options and RSUs granted to employees.
Share information H2 2023 H2 2022
Net income attributable to owners of Adyen N.V. (in EUR '000) 416,149 282,002
Weighted average number of ordinary shares for the period 31,012,122 30,975,325
Dilutive effect of share options 144,868 70,704
Weighted average number of ordinary shares for diluted net profit
31,156,990 31,046,029
for the period
Net profit per share – basic 13.42 9.10
Net profit per share - diluted 13.36 9.08
Shareholder letter H2 2023 47

14. Related party transactions

During 2023, Adyen identified related party transactions with Stichting Administratiekantoor Adyen (STAK),
employees and Supervisory Directors. The transactions with employees and STAK are related to option exercises,
and the transactions with Supervisory Board relate to services rendered throughout the period. The respective
outstanding balances as at December 31, 2023 and 2022 are:
Related party assets/ (liabilities) December 31, 2023 December 31, 2022

Supervisory Board (19) (115)

Employees (STAK) 16,562 3,627

There were no other transactions with related parties during the period ended December 31, 2023 and 2022.

15. Other contingent assets, liabilities and commitments

Adyen N.V. and Adyen International B.V. are included in a fiscal unity for corporate income tax purposes. Under the
Dutch Tax Collection Act, the members of the fiscal unity are jointly and severally liable for any taxes payable by the
fiscal unity.
Adyen has EUR 50,678 of outstanding bank guarantees and letters of credit as at December 31, 2023 (December 31,
2022: 51,299).
Adyen has set up a collateral account in which Brazilian Government bonds were deposited by a partner financial
institution, in order to decrease its exposure to this counterparty in Brazil. As at December 31, 2023 the total
collateral was EUR 14,955 (BRL 80,101) (December 31, 2022: EUR 31,086 (BRL 175,828)).

16. New and amended standards adopted by Adyen

The following accounting standards, interpretations and amendments applicable to Adyen (collectively,
“amendments”) were issued and made effective for the annual reporting period beginning on January 1, 2023:
• Amendments to IAS 1, Practice Statement 2 and IAS 8 - accounting policy disclosures;
• Amendments to IAS 12 - Deferred tax related to assets and liabilities arising from a single transaction;
• Amendments to IFRS 16 - Leases on sale and leaseback;
• Amendments to IAS 1 - Non-current liabilities with covenants.

Adyen has taken into consideration the changes of each one of the above-mentioned amendments, refer to note 6.2
'Deferred income taxes', and concluded that the amendments do not have a material impact on the
financial statements.

17. Events after the balance sheet date

There are no events after the reporting period.
Shareholder letter H2 2023 48

18. Other information

The interim condensed consolidated financial statements for the period July 1, 2023 to December 31, 2023 have
been prepared in line with the accounting and recognition principles included in the Adyen annual consolidated
financial statements of 2022, in accordance with International Financial Reporting Standards and IFRIC
interpretations as endorsed by the European Union (EU-IFRS).
The interim condensed consolidated financial statements are unaudited.
Amsterdam, February 8, 2024

P.W. van der Does I.J. Uytdehaage E.L. Tandowsky

Co-founder and Co-CEO Co-CEO CFO
Shareholder letter H2 2023 49

Statement by the Management Board

As is required by section 5.25d of the Dutch Financial Supervision Act (Wet op het financieel toezicht) we state that
according to the best of our knowledge:
1. The interim condensed consolidated financial statements present a true and fair view of the consolidated
assets, liabilities, financial position and the profit or loss of Adyen N.V.; and
2. The interim consolidated financial statements provide a true and fair view of the information required
pursuant to article 5.25d paragraph 8 and 9 of the Dutch Financial Supervision Act (Wet op het financieel
toezicht).

Amsterdam, February 8, 2024

P.W. van der Does I.J. Uytdehaage E.L. Tandowsky

Co-founder and Co-CEO Co-CEO CFO