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Mar 31, 2024
Bakkt Q1 2024 Earnings Report
Bakkt's financial performance in Q1 2024 showed significant revenue growth driven by crypto services and a reduction in operating expenses, resulting in a decreased net loss.
Key Takeaways
Bakkt reported a significant increase in total revenues to $854.6 million, driven by the acquisition of Bakkt Crypto. The company reduced its operating expenses excluding crypto costs by 16% year-over-year, leading to a 53% improvement in net loss. Bakkt is also progressing with the launch of its Electronic Consumer Network (ECN), BakktX.
Total revenues reached $854.6 million, including gross crypto revenues and net loyalty revenues.
Client crypto trading activity saw a substantial increase, with notional traded volume up 324% quarter-over-quarter.
Operating expenses, excluding crypto costs, decreased by 16% year-over-year to $48.8 million.
Net loss improved by 53% year-over-year to $21.3 million.
Bakkt
Bakkt
Bakkt Revenue by Segment
Revenue by Segment
Crypto Services Revenue
CapyFin.comLoyalty Services, Net Revenue
CapyFin.com Forward Guidance
Bakkt anticipates full year 2024 revenues between $3,002 million and $4,447 million, including gross crypto revenues of $2,949 million - $4,390 million and net loyalty revenues of $53 million - $57 million. They expect full year 2024 operating expenses excluding crypto costs to be $155 million - $165 million and anticipate using $58 million - $72 million in operating activities. They forecast free cash flow usage of $64 million - $78 million and expect to have $42 million - $57 million in available cash, cash equivalents, and available-for-sale securities at year-end.
Positive Outlook
- Increased revenue contribution from existing clients/accounts based on observed retail trading engagement metrics.
- Expected 1x – 3x increase in crypto trading accounts vs. Q4’23.
- Activation of crypto coin pairs in 2H24 to support international retail trading demand.
- Addition of institutional clients with steady ramp-up in assets under custody in 2H’24.
- Integration of regulated entities beginning March 2024 including $5mm additional release of surety bond restricted cash collateral.
Challenges Ahead
- Lower contribution from new clients.
- Crypto costs and ECB in line with gross crypto revenue.
- Comp expense savings from restructuring offset by increased non-cash compensation and restructuring charges.
- 5mm reduction in net contribution from crypto trading.
- Net cash used in operating activities expected to be ($58 million) – ($72 million).
Revenue & Expenses
Visualization of income flow from segment revenue to net income