From a churn perspective, since the third quarter of 2022, we’ve seen relative stability in churn of existing sellers on a year-over-year basis, no material changes there. From a same-store growth perspective or a GPV per sellers, there is a kind of a couple of things that unpack for you where we’ve seen the moderation. First, it looks to be consumer-related. Second, it looks to cross multiple verticals. Third, this — sort of retention dynamic or GPV per seller dynamic. Teams that account for the majority of the GPV growth [indiscernible] that we’ve seen since the third quarter of last year. And for us, we see similarity in our data here on GPV per seller trend to broader third-party data as well. So let me kind of walk-through each of those elements.
First, processing volumes at existing sellers are again sort of that same-store growth element, were lower in the second quarter of 2023 compared to the third quarter of 2022 levels. We noted seeing the similar dynamics since mid-November, which is kind of that Q4 timeframe that you’re referencing. We believe it’s consumer-related as growth spend per card and the number of unique cards remains lower than October levels, while churn, as I mentioned remains relatively stable. Ultimately, obviously, we manage the business to gross profit but unpacking some of the GPV trends might be helpful to illustrate here. Since the third quarter of 2022, we’ve seen an 8 point slowdown in Square’s global GPV growth from 20% or so to 12% or so. We estimate the GPV per seller or same-store growth has been responsible for the vast majority of the slowdown since the third quarter of last year.
It’s really impacting nearly all the verticals we see in recent quarters and impacts broadly across the seller base by seller size as well, but perhaps more pronounced amongst larger sellers. And similar to the data that we’ve seen and that we’re tracking on third-party data, since the third-quarter, our US GPV growth has slowed by 7 points and we’ve seen an 8 point slowdown in growth of US retail sales and a 6 point slowdown in the growth of Visa and Mastercard volumes in the US. So these are some of the key elements that I’d point you to that kind of unpack what we’re seeing from a same-store growth or GPV trend-line perspective.
Jason Kupferberg: [indiscernible] for 2023, I just wanted to make sure I heard the commentary right there.
Amrita Ahuja: Sorry, say that again, on 2023?
Jason Kupferberg: For the fourth quarter of 2023, the relative growth rate you’re expecting on GP and GPV versus Q3, 2023.
Amrita Ahuja: Sure, yes, what we shared for Q4 was that we expect to see a slight improvement in gross profit and GPV growth compared to Q3. Q3, remember we’re sort of — urge you need to look at the July rate for Q3, the July rates being 15% gross profit growth for Square and 12% GPV growth for Square, but we expect to see improvement in the fourth quarter given some of the more favorable comparisons. Again as I referenced, we started to see some of the moderation in growth across these verticals in the mid-Q4 time-frame of last year. The second part of your question, Jason, was on inflows per active, the 8% growth there, and in the second quarter, and I think your question was just sort of the sustainability or how we see growth on inflows per active over time.
Jason Kupferberg: Yes, for the second half of this year. Thanks.
Amrita Ahuja: Sure. Yes, as I noted in the remarks earlier, we expect from 2023 perspective to see overall growth in inflows per active. We saw that 8% growth in the second quarter as well, and relative stability quarter-over-quarter even though we have a greater impact from tax refunds in the first quarter. Ultimately, we’ve been encouraged here by the healthy trends. As we look forward, I think there’s kind of two dynamics that I’d point out beyond the broader question of consumer health and consumer spend levels. One is product adoption. If we can drive more product adoption and cross-sell of our products, that gives customers more reasons to onboard more funds into Cash App. Also, if we give customers more ways that they can onboard their funds into Cash App that also, for example, Pay for money deposits in the past couple of quarters, that also gives us — leads to incremental volumes on inflows and opportunities to engage customers through our products.
The one mitigating element to that is the mix-shift dynamic as we attract younger demographics into Cash App and we’ve seen strong and encouraging trends with younger demographics like Gen-Z demographics that could put some pressure on inflows per active as these customers are more likely to have lower inflows per active earlier in their financial journey, but this is the demographic that we want to be growing with over the long-term. So those are kind of the two dynamics that I would share with you as you think about modeling inflows per active over time.
Jason Kupferberg: Very helpful, thanks.
Operator: And we have time for one more question. We’ll take our last question from Jamie Friedman with Susquehanna International Group.
Jamie Friedman: Hi. I was wondering, Amrita or Jack, how Afterpay is performing relative to your expectations from a credit perspective. I realize losses on consumer receivables were just 1.01%, essentially the same as last year, but is that more due to your treatment of the credit box? How, overall, are you thinking about that, the originations versus the profitability from a credit perspective? Thank you.
Amrita Ahuja: I can start on that one. What I would say is that what we’ve seen for Afterpay in the first half of this year is stability to improvement and overall trend lines from a topline perspective, whether you look at GMV or gross profit with consistent loss rates and we’ve maintained a really disciplined approach here to risk loss and continue to see stable trends in consumer health and repayment behavior with stability as you noted on losses on consumer receivables from the year-over-year perspective in the second quarter. This is while GMV was up 22% year-over-year in the second quarter and improving from the 17% growth rate in the first quarter. And similarly, while gross profit was up improving from — at 13% year-over-year in the second quarter, improving from 10% in the first quarter.
So we’ve seen stable to improving trends on the core BNPL products within Afterpay, while we continue to focus on much larger opportunities on integration with the commerce pillar connecting our Cash App and Square ecosystems and while we maintain healthy loss rates across the ecosystem.
Jamie Friedman: Perfect. Thank you.
Operator: Thank you. Ladies and gentlemen, thank you for participating in today’s program. This does conclude the program. You may now disconnect.
