Bakkt, Inc. · NYSE:BKKT
Bakkt — Q3 2024 Earnings Presentation
23 slides from Bakkt's earnings presentation, Nov 14, 2024
Slide 1: Third Quarter 2024 Earnings
Third Quarter 2024 Earnings November 14, 2024
Slide 2: Important notice
Important notice Unless the context otherwise provides, “we,” “us,” “our,” “Bakkt” and like terms refer to Bakkt Holdings, Inc. and its subsidiaries. FORWARD-LOOKING STATEMENTS This presentation and accompanying oral presentation contains “forward-looking statements” within the meaning of Section 27
Slide 3: Significant increases in trading volume
Significant increases in trading volume • $279 million from Nov 1 to Nov 12, surpassing October total MONTHLY NOTIONAL TRADED VOLUME ($mm) DAILY NOTIONAL TRADED VOLUME ($mm) $279 $72 $56 $51 $165 $102 $106 $23 $19 $14 $15 $11 $6 $5 $3 $3 1 Aug '24 Sept '24 Oct '24 Nov '24 Nov 1 Nov 2 Nov 3 Nov 4 Nov
Slide 4: Q3'24: Financial and operational update
Q3’24: Financial and operational update Revenue, net 1 $14.8 $14.6 Financial Update1,2,3 • Revenues, net down 8.8% YoY to $13.4 million • Total volume down from March peak, below the broader market $13.4 • Opex, excluding crypto costs, down 39.7% YoY • Net loss of $6.3 million, improved by 87.8% YoY
Slide 5: Macro update: favorable tailwinds
Macro update: favorable tailwinds Regulatory Progress Monetary Policy Shift • FASB adoption of Fair Value for crypto assets • Federal Reserves 50bps + 25bps rate cut • Launch of Bitcoin and Ethereum spot ETFs • Lenient monetary policy • SEC approval of options trading for • Historically positive for
Slide 6: Bakkt ecosystem expansion
Bakkt ecosystem expansion BakktX1 Nationwide BitLicense and MTLs, ensuring secure, efficient, and compliant operations. Real-time trades with minimal slippage, zero rate Scalable infrastructure Operational Efficiency reducing counterparty risk, limits, tight spreads, and enhancing market access Risk
Slide 7: Reiterating our 2024 priorities
Reiterating our 2024 priorities Focused on three key priorities to drive shareholder value Broaden client network and Expand our products and Continued improvement of deepen existing relationships solutions our cost structure • Partnerships: Hidden Road, • BakktX soft launch in Q4 • Maintaining cost
Slide 8: Financial results
Financial results
Slide 9: 3Q24 KPIs
3Q24 KPIs • Crypto enabled accounts of 6.5mm have continued to increase steadily QoQ • Loyalty transacting accounts and redemption volume up YoY and down sequentially • Crypto trading volume down 36.2% sequentially, slightly below the broader market but up 64.9% YoY • Assets under custody of $938.7m
Slide 10: 3Q24 revenues
Revenue by Product 3Q24 revenues Loyalty Crypto $854.6 ($M) $509.9 Crypto revenues $841.3 $328.4 • Gross revenues of $328.4mm driven by increase in crypto $204.8 $214.5 $497.1 transaction volumes YoY due to Bakkt Crypto acquisition $191.8 $199.4 $316.3 and higher industry wide trading activity. QoQ,
Slide 11: 3Q24 operating expenses
3Q24 operating expenses Operating Expenses $886.4 ($M) $16.5 • Total operating expenses of $355.8mm includes $7.8 $315.0mm of crypto costs and execution, clearing $24.5 $531.9 and brokerage fees, related to Bakkt Crypto $9.0 $355.8 $293.0 $5.5 • SG&A expenses of $8.5mm increased by 14.0% $7.0 $22.4
Slide 12: 3Q24 adjusted EBITDA (non-GAAP)
3Q24 adjusted EBITDA (non-GAAP) $mm's 3Q24 2Q24 3Q23 Net loss $(6.3) $(35.5) $(51.7) • Adjusted EBITDA loss of $(23.7)mm increased YoY Depreciation and amortization 0.1 0.1 4.0 Interest income, net (1.0) (1.2) (1.2) primarily due to last year’s temporary higher take Income tax expense (benefit) (0.1
Slide 13: 3Q24 condensed P&L
3Q24 condensed P&L $mm’s except for per share amounts 3Q24 2Q24 3Q23 Crypto services $316.3 $497.1 $191.8 Loyalty services 12.1 12.8 13.0 • Total revenues of $328.4 mm, up 60.4% YoY in gross crypto and Total revenues $328.4 $509.9 $204.8 loyalty trading revenue driven by Bakkt Crypto Crypto costs an
Slide 14: 3Q24 condensed balance sheet
3Q24 condensed balance sheet As of 9/30/24 As of 12/31/23 $mm's (unaudited) • $35.7mm of cash, cash equivalents and available- Assets Cash & cash equivalents $29.0 $52.9 for-sale securities as of September 30, 2024 Available-for-sale securities 6.7 17.4 • We used $25.0 million of cash, cash equivale
Slide 15: 2024 outlook - updates to key assumptions
2024 outlook - updates to key assumptions • 2024 Revenue Outlook Adjustment: Loyalty revenue range of $49-$50 million, falling short of prior guidance by $4-7 million, mainly due to reduced transaction volumes. • Gross Crypto Revenue, less Crypto Costs and ECB: Expected to be at the low end of $10 -
Slide 16: Notes
Notes
Slide 17: Definitions
NOTES Definitions Crypto-enabled accounts: total crypto accounts open Transacting accounts: unique accounts that perform at least one transaction across crypto buy/sell and loyalty redemption each month. Monthly figures are de-duped for the month. Quarterly figure represents sum of all months in the
Slide 18: Adjusted EBITDA
NOTES Adjusted EBITDA Adjusted EBITDA is a non-GAAP financial measure, which we define as earnings before interest, income taxes, depreciation, amortization, acquisition-related expenses, share-based and unit-based compensation expense, goodwill and intangible assets impairments, restructuring charg
Slide 19: Adjusted EBITDA reconciliation – Non-GAAP
NOTES Adjusted EBITDA reconciliation – Non-GAAP $mm's 3Q24 2Q24 3Q23 Net loss $(6.3) $(35.5) $(51.7) Depreciation and amortization 0.1 0.1 4.0 Interest income, net (1.0) (1.2) (1.2) Income tax expense (benefit) (0.1) 0.1 0.2 EBITDA $(7.3) $(36.5) $(48.7) Acquisition-related expenses — 0.1 (0.7) Shar
Slide 20: Free cash flow reconciliation – Non-GAAP
NOTES Free cash flow reconciliation – Non-GAAP Free Cash Flow is a non-GAAP financial measure. Free Cash Flow is cash flow from operations adjusted for “capitalized internal use software development costs and other capital expenditures” and “interest income.” We adjust for capitalized expenses assoc
Slide 21: Statement of operations
NOTES Statement of operations Note: Quarterly financial data on this slide is unaudited.
Slide 22: Balance sheet
NOTES Balance sheet Note: Quarterly financial data on this slide is unaudited.
Slide 23: Statement of cash flows
NOTES Statement of cash flows Note: Quarterly financial data on this slide is unaudited.