Green Dot Corporation · NYSE:GDOT
Green Dot — Q3 2024 Earnings Presentation
31 slides from Green Dot's earnings presentation, Nov 7, 2024
Slide 1: Q3 2024 Results
Q3 2024 Results November 7th, 2024 Green Dot Corporation
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation contains forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements include, among other things, statements regarding Green Dot’s business and pipeline momentum, revenue
Slide 3: Key Q3 Highlights and Themes
Key Q3 Highlights and Themes Revenue momentum continues to Focused on efficiency, adjusted Arc by Green Dot; A new brand Q3 2024 improve and actives grew on a EBITDA margins were up modestly positioned to capitalize on growth Results sequential basis in the quarter of the embedded finance market Res
Slide 4: Consolidated Results
Consolidated Results Non-GAAP Revenue1 Adjusted EBITDA1 Non-GAAP Revenue1 increased 16% • Consumer Services down 17%. • B2B Services up 39%. • Money Movement down 1%. Adjusted EBITDA1 up 19% • The adjusted EBITDA margin of 7% was up 16 bps as the company moved through the majority of headwinds assoc
Slide 5: Consolidated Key Metrics
Consolidated Key Metrics Active Accounts1 Gross Dollar Volume (GDV) Active accounts1 declined 6% • The rate of decline for consolidated actives continues to moderate and is at its slowest rate in several years as growth in B2B Services active accounts offset a 18% decline in Consumer Services active
Slide 6: Consumer Services Segment
Consumer Services Segment Segment Revenue Segment Profit Segment revenue declined 17% • Declines continue to remain largely driven by secular headwinds in the Retail channel and the de-conversion of a retail program. • Revenue in the Retail channel declined 24% due to de-conversion of a retail progr
Slide 7: B2B Services Segment
B2B Services Segment Segment Revenue Segment Profit Segment revenue increased 39% • Growth remains largely driven by a key BaaS partner and rapid! PayCard. Excluding the growth from a key BaaS partner, the rest of the BaaS channel continued to see stabilization. • rapid! PayCard saw solid growth dri
Slide 8: Money Movement Services Segment
Money Movement Services Segment Segment Revenue Segment Profit Segment revenue declined 1% • Growth was impacted by a continued decline in revenue in the Money Processing channel while Tax Processing revenue was flat. The Green Dot Network, a component of the Money Processing channel, continues to s
Slide 9: 2024 Guidance and Outlook
2024 Guidance and Outlook Projected Non-GAAP Revenue1 of $1.65B-$1.70B Projected Adjusted EBITDA1 of $164M-$166M Projected Non-GAAP EPS1 of $1.33-$1.36 2024 Considerations Consumer B2B Money Movement and Outlook Segment Segment Segment Company expects full year adjusted Secular headwinds, sunsetting
Slide 10: Appendix: Segment Information
Appendix Segment Information 10 Green Dot Corporation
Slide 11: Reconciliation of Segment Revenues
Reconciliation of Segment Revenues Green Dot's segment reporting is based on how its Chief Operating Decision Maker (“CODM”) manages its businesses, including resource allocation and performance assessment. Its CODM (who is the Chief Executive Officer) organizes and manages the businesses primarily
Slide 12: Reconciliation of Segment Profits
Reconciliation of Segment Profits Green Dot Corporation
Slide 13: Appendix: Division Information
Appendix Division Information 13 Green Dot Corporation
Slide 14: Retail division
Retail division Revenue Active Accounts1 Revenue declined 24% • Declines remain driven largely by secular headwinds and the de- conversion of a retail program that continued to create headwinds for 3Q24. • Revenue per active1 was up 9% excluding the impact of the program de-conversion, which created
Slide 15: Direct division
Direct division Revenue Active Accounts1 Revenue declined 2% • Declines continue due to the deliberate decision to focus growth on building out the GO2bank brand and sunsetting legacy products. • After sunsetting several legacy brands in 2Q23 (with the full impact felt in 3Q23) direct revenue has be
Slide 16: BaaS division
BaaS division Revenue Active Accounts1 Revenue increased 43% • Revenue growth was primarily driven by a large strategic partner while the rest of the BaaS business continues to see stabilization. Active accounts1 increased 52% • Active accounts continued to increase due to the growth of new partners
Slide 17: rapid! Paycard division
rapid! Paycard division Revenue Active Accounts1 Revenue increased 1% • Revenue was driven by changes in pricing strategies in 4Q23 which benefitted revenue per active account. Active accounts1 declined 23% • The decline in active accounts is largely driven by pressure on the temporary staffing indu
Slide 18: Money Processing division
Money Processing division Revenue Cash Transfers to GDOT-Issued Accounts Revenue declined 1% • Declines remain largely driven by the decline in transactions from Green Dot-issued active accounts in the Consumer Services segment. Cash transfers to GDOT-issued accounts declined 22%; Third Party volume
Slide 19: Tax Processing division
Tax Processing division Revenue Tax Refunds Processed Revenue increased 1% • In the seasonally soft third quarter, revenue was up slightly Refunds processed were down 5% • Year-over-year growth in volumes in the third and fourth quarters is hard to predict and generally comprises a minimal amount of
Slide 20: Appendix
Appendix Non-GAAP Financial Measures 20 Green Dot Corporation
Slide 21: About Non-GAAP Financial Measures
About Non-GAAP Financial Measures To supplement Green Dot's consolidated financial statements presented in accordance with accounting principles generally accepted in the United States of America ("GAAP"), Green Dot uses measures of operating results that are adjusted for, among other things, non-op
Slide 22: Non-GAAP Financial Measures
Non-GAAP Financial Measures Green Dot Corporation
Slide 23: Non-GAAP Financial Measures
Non-GAAP Financial Measures Green Dot Corporation
Slide 24: Non-GAAP Financial Measures
Non-GAAP Financial Measures Green Dot Corporation
Slide 25: Non-GAAP Financial Measures
Non-GAAP Financial Measures Green Dot Corporation
Slide 26: Non-GAAP Financial Measures
Non-GAAP Financial Measures Green Dot Corporation
Slide 27: Non-GAAP Financial Measures
Non-GAAP Financial Measures Green Dot Corporation
Slide 28: Non-GAAP Financial Measures
Non-GAAP Financial Measures 1) To supplement Green Dot’s consolidated financial statements presented in accordance with GAAP, Green Dot uses measures of operating results that are adjusted to exclude various, primarily non-cash, expenses and charges. These financial measures are not calculated or pr
Slide 29: Non-GAAP Financial Measures
Non-GAAP Financial Measures Green Dot understands that, although adjusted EBITDA and other non-GAAP financial measures are frequently used by investors and securities analysts in their evaluations of companies, these measures have limitations as an analytical tool, and you should not consider them i
Slide 30: Non-GAAP Financial Measures
Non-GAAP Financial Measures 4) Green Dot excludes certain income and expenses that are the result of acquisitions. These acquisition-related adjustments include items such as transaction costs, the amortization of acquired intangible assets, changes in the fair value of contingent consideration, set
Slide 31: Non-GAAP Financial Measures
Non-GAAP Financial Measures 8) Represents commissions and certain processing-related costs associated with BaaS products and services where Green Dot does not control customer acquisition. This adjustment is netted against Green Dot's B2B Services revenues when evaluating segment performance. 9) Rep