Bakkt, Inc. · NYSE:BKKT
Bakkt — Q4 2023 Earnings Presentation
28 slides from Bakkt's earnings presentation, Mar 25, 2024
Slide 1: Fourth Quarter and Full Year 2023 Earnings
Fourth Quarter and Full Year 2023 Earnings March 25, 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: Perspectives on the Business
Perspectives on the Business
Slide 4: CEO perspectives on the business
CEO perspectives on the business We are laser focused on We are well-positioned to We have a strong Our company is at an enhancing shareholder capitalize on crypto foundation inflection point value market opportunities Proud of what the company Fortified our balance sheet with Strong execution and s
Slide 5: Secure, compliance-focused platform differentiates us from other crypto providers
Our secure, compliance-focused platform along with our public company status, differentiates us from most other crypto providers • End-to-end crypto capabilities, from onramps to advanced trading and secure custody • Loyalty redemption platform provides clients with flexible, comprehensive solutions
Slide 6: Key priorities in 2024
Key priorities in 2024 We believe executing on our key priorities will enable us to create sustainable shareholder value and restore partner confidence Broaden client network and deepen existing Expand our products Prudent expense relationships and solutions management Continue to execute on Deliver
Slide 7: Retail crypto trading will be a significant driver of our growth in 2024
Retail crypto trading will be a significant driver of our growth in 2024 • Continuing to build on our success in signing up new retail • Strong recent tailwinds for retail crypto trading with crypto trading clients onto our platform. We have agreed to increased industrywide volume activity and highe
Slide 8: Expanding our institutional crypto capabilities will provide significant growth opportunities
Expanding our institutional crypto capabilities will provide significant growth opportunities NEW INSTITUTIONAL CLIENTS • Our secure and trusted institutional-grade custody foundation along with our public company status, differentiates us from most other providers in the institutional crypto space.
Slide 9: Financial results
Financial results
Slide 10: Summary of 4Q23 condensed results
Summary of 4Q23 condensed results 4Q23 results include Apex Crypto, now known as Bakkt Crypto, which we acquired on April 1, 2023. In accordance with GAAP, we are presenting crypto services revenue and crypto costs and execution, clearing and brokerage fees on a gross basis • Total revenues of $214.
Slide 11: Summary of full year 2023 condensed results
Summary of full year 2023 condensed results 2023 results include Bakkt Crypto, which we acquired on April 1, 2023. In accordance with GAAP, we are presenting crypto services revenue and crypto costs and execution, clearing and brokerage fees on a gross basis • Total revenues of $780.1mm reflects sig
Slide 12: 4Q23 Adjusted EBITDA (non-GAAP)
4Q23 Adjusted EBITDA (non-GAAP) 4Q23 Adjusted EBITDA loss of $(19.0)mm decreased YoY primarily due to a reduction in total compensation and benefits Note: All financial data on this slide is unaudited. Adjusted EBITDA is a non-GAAP financial measure. For more information, please refer to the Notes s
Slide 13: 4Q23 Revenues
4Q23 Revenues 4Q23 results include Bakkt Crypto, which we acquired REVENUES BY PRODUCT ($MM) on April 1, 2023. In accordance with GAAP, we are Loyalty Crypto $100 $347.6 presenting crypto services revenue on a gross basis $80 $204.8 $214.5 $60 $335.3 Crypto revenues $40 $15.9 $13.2 $191.8 $199.4 $20
Slide 14: 4Q23 Operating expenses
4Q23 Operating expenses 4Q23 results include Bakkt Crypto, which we acquired on April 1, 2023. In accordance with GAAP, we are presenting our crypto costs and execution, clearing and brokerage fees on a gross basis • Total operating expenses of $293.0mm EXPENSES ($MM) includes $197.8mm of crypto cos
Slide 15: 4Q23 Crypto services revenue and related costs
4Q23 Crypto services revenue and related costs 4Q23 results include Bakkt Crypto, which we acquired on April 1, 2023. In accordance with GAAP, we are presenting our crypto services revenue and crypto costs and execution, clearing and brokerage fees on a gross basis Crypto services revenue CRYPTO SER
Slide 16: 4Q23 Key performance indicators
4Q23 Key performance indicators • Crypto enabled accounts of 6.2mm have continued to increase steadily QoQ through 2023 • Crypto trading volume up 6% QoQ as improving industry wide volumes were partially offset by continued lower activity from Webull Pay customers • Loyalty redemption volume down 9%
Slide 17: 4Q23 Condensed balance sheet
4Q23 Condensed balance sheet • $70.3mm of cash, cash equivalents and available-for-sale securities. • 4Q23 cash usage of $20.8mm includes $4.4mm of insurance spend • Capex1 spend of $1.5mm • Full year 2023 cash usage of $169.1mm includes ~$55mm of cash purchase price for Bakkt Crypto • Capex1 spend
Slide 18: We will leverage our strong liquidity position and remain focused on driving our business towards profitability
We will leverage our strong liquidity position and remain focused on driving our business towards profitability • Available cash, cash equivalents and AFS securities as of 2/29/24 (pre- OPERATING EXPENSES1 ($mm) capital raise) of $38.1mm • Cash usage in January and February was unusually high due to
Slide 19: Updating our expected full year 2024 outlook
Updating our expected full year 2024 outlook Key Assumptions FINANCIAL METRIC OUTLOOK Gross Crypto Revenue, Crypto Costs and ECB Revenues • Total revenues of $3,292mm - $5,114mm • Range is based on a range of retail trading engagement • Gross crypto revenues of $3,239mm - metrics $5,057mm • Net loya
Slide 20: Key priorities in 2024
Key priorities in 2024 We believe executing on our key priorities will enable us to create sustainable shareholder value and restore partner confidence Broaden client network and deepen existing Expand our products Prudent expense relationships and solutions management Continue to execute on Deliver
Slide 21: Notes
Notes
Slide 22: 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 23: 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 24: Adjusted EBITDA reconciliation – Non-GAAP
NOTES Adjusted EBITDA reconciliation – Non-GAAP Note: Quarterly financial data on this slide in unaudited. Adjusted EBITDA is a non-GAAP financial measure. 24
Slide 25: 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 26: Balance sheet
NOTES Balance sheet $m Assets Current assets Cash and cash equivalents Restricted cash Customer funds Available-for-sale securities Accounts receivable, net Prepaid insurance Safeguarding asset for crypto Other current assets Total current assets Property, equipment and software, net Goodwill Intang
Slide 27: Statement of operations
NOTES Statement of operations Note: Quarterly financial data on this slide is unaudited. 27
Slide 28: Statement of cash flows
NOTES Statement of cash flows Note: Quarterly financial data on this slide in 28 unaudited.