Slide 1: Alkami Technology Third Quarter 2024
Alkami Technology, Inc. Proprietary Information. Alkami Technology Third Quarter 2024
Slide 2: Forward-Looking Statements
2 © A lk am i T ec h n o lo gy , I n c. This presentation contains “forward-looking” statements relating to Alkami Technology, Inc.’s strategy, goals, future focus areas, and expected, possible or assumed future results, including its future cash flows and its financial outlook. These forward-lookin
Slide 3: Who We Are
3 © A lk am i T ec h n o lo gy , I n c. Who We Are • Cloud-based digital banking platform serving U.S. financial institutions What We Do • Empower FIs to grow, drive user engagement and improve operational efficiency • Leverage broad product set enabling retail and commercial banking How We Do It •
Slide 4: U.S. Digital Banking User Distribution
4 © A lk am i T ec h n o lo gy , I n c. U.S. Digital Banking User Distribution Users in millions by asset range, including megabanks Source: FI Navigator, December 2023
Slide 5: Alkami's Addressable Market: User Characteristics
5 © A lk am i T ec h n o lo gy , I n c. Alkami’s Addressable Market: User Characteristics 250M+ digital users, excluding megabanks Total market digital users growing 5-8% historically, driven by: ● Increasing number of accounts per customer ● Ease of new account opening via digital tools ● Demograph
Slide 6: Go-To-Market Cadence
6 © A lk am i T ec h n o lo gy , I n c. Go-To-Market Cadence We focus on the top 2,500 FIs excluding the megabanks Industry average contract length is 5 years, translating to approximately 500 contracts up for renewal annually 500 Annual Renewals 2,500 Target Clients v 9,000+ FIs Over 9,000 FIs in t
Slide 7: Alkami's Addressable Market Growing Healthy $14 billion TAM
7 © A lk am i T ec h n o lo gy , I n c. Alkami’s Addressable Market Growing healthy $14 billion TAM Total Addressable Market • 250M digital users x $58 ARPU • Digital users growing 5% to 8% annually • 30+ products today vs. 9 in 2015 Core Platform • 250M digital users x $35 ARPU • Existing client di
Slide 8: Multiple Levers Driving Growth
8 © A lk am i T ec h n o lo gy , I n c. Multiple Levers Driving Growth ● Clients driven by new logo wins, historically among credit unions, with a growing presence among banks ● Registered users grow as we add new logos and as clients add users ● RPU driven by product penetration at initial sale and
Slide 9: Alkami's Digital Sales & Service Platform
9 © A lk am i T ec h n o lo gy , I n c. Alkami’s Digital Sales & Service Platform Onboard Engage Grow Guard Sales Service Digital Account Opening Marketing Data Insights Card Experience Customer Service Commercial Services Financial Wellness Security & Fraud Protection Money Movement Extensibility C
Slide 10: Product Strategy
10 © A lk am i T ec h n o lo gy , I n c. Product Strategy ● Lead with UX ● Deepen integrations with cores & third party systems ● Hyperfocus on Commercial Banking & DAO ● Data Integrity ● Integrating Flux, Segmint and Digital Banking further ● Monetizing data ● Streamlined, trackable and performant
Slide 11: How We Achieve Our Long-term Objectives
11 © A lk am i T ec h n o lo gy , I n c. How We Achieve Our Long-term Objectives Market Leadership Maintain Strong Credit Union Position Grow Bank Mindshare and Capabilities Drive Add-On Sales Scale and Continued Cost Discipline Continuous Product and Platform Improvement
Slide 12: Financial Overview
Alkami Technology, Inc. Proprietary Information. Financial Overview
Slide 13: Q3 2024 Financial Performance
13 © A lk am i T ec h n o lo gy , I n c. Q3 2024 Financial Performance $M ● Q3’24 revenue growth of 27% driven by new clients, existing client user growth and ARPU growth ● GM expansion consistent with our plan to increase GM 200-300 bps per year through 2026 ● Adjusted EBITDA expansion driven by co
Slide 14: Operating and Financial Highlights Q3 2024
14 © A lk am i T ec h n o lo gy , I n c. Operating and Financial Highlights Q3 2024 $342M ARR Subscription Revenue Mix as of 9/30/24 95% Subscription Revenue 12/31/23 115% Net Dollar Retention Remaining Performance Obligations as of 9/30/24 $1.3B RPO Digital Banking Clients 266 Q3 2024 229 Q3 2023 R
Slide 15: Client Base Expansion
15 © A lk am i T ec h n o lo gy , I n c. Client Base Expansion 2020 151 177 199 236 37 57 67 89 2021 2022 2023 ARR growth driven by larger new logos and increased product penetration 266 104 Q3’24 Total Digital Banking Platform Clients Clients with ARR > $1M
Slide 16: Technology Demand and Product Expansion Drive ARR Cohort
16 © A lk am i T ec h n o lo gy , I n c. Technology Demand and Product Expansion Drive ARR Cohort ARR Expansion Via User Growth and Cross-Sell Success ARR Expansion Drivers ● Long-term contracts ● Escalating contract minimums ● Gross client retention ● Growth in digital user adoption ● Product cross
Slide 17: Strong Historical Revenue Growth
17 © A lk am i T ec h n o lo gy , I n c. Strong Historical Revenue Growth $M
Slide 18: Gross Margin Expansion Driven by Scale and Efficiency
18 © A lk am i T ec h n o lo gy , I n c. Gross Margin Expansion Driven by Scale and Efficiency $M
Slide 19: Best-in-Class GTM Efficiency
19 © A lk am i T ec h n o lo gy , I n c. Best-in-Class GTM Efficiency ● Long-term contract structure reduces annual GTM motion ● Alkami models annual client retention of 97% - 98% ● 2026E reflects continued growth in S&M spend related to bank market expansion and increased product depth ● Historical
Slide 20: Clear Path to Manage Equity Dilution
20 © A lk am i T ec h n o lo gy , I n c. Clear Path to Manage Equity Dilution
Slide 21: 2024 Financial Guidance
21 © A lk am i T ec h n o lo gy , I n c. 2024 Financial Guidance
Slide 22: Attractive Long-Term Profile
22 © A lk am i T ec h n o lo gy , I n c. Attractive Long-Term Profile Expect margin improvement through scale, product mix and operational efficiency
Slide 23: Selected Historical Data
23 © A lk am i T ec h n o lo gy , I n c. Selected Historical Data 2020 2021 2022 2023 Q3’24 Digital banking platform clients 151 177 199 236 266 Growth % 17% 12% 19% 16% Digital banking platform users (M) 9.7 12.4 14.5 17.5 19.5 Growth % 28% 18% 20% 15% Live ARR ($M) $ 128.0 $ 169.0 $ 226.1 $ 291.0
Slide 24: Non-GAAP Reconciliations ($000s)
24 © A lk am i T ec h n o lo gy , I n c. Non-GAAP Reconciliations ($000s)
Slide 25: Non-GAAP Reconciliations ($000s)
25 © A lk am i T ec h n o lo gy , I n c. Non-GAAP Reconciliations ($000s)
Slide 26: Non-GAAP Reconciliations ($000s)
26 © A lk am i T ec h n o lo gy , I n c. Non-GAAP Reconciliations ($000s)