Green Dot Reports Third Quarter 2024 Results
Green Dot (NYSE: GDOT) announced its Q3 2024 financial results, highlighting a 16% increase in total operating revenues to $409.7 million compared to Q3 2023. The company introduced 'Arc by Green Dot' to focus on the embedded finance market. Despite a larger GAAP net loss of $7.8 million (a 25% increase from last year), Green Dot saw a 19% growth in adjusted EBITDA to $28.3 million. However, non-GAAP net income declined by 6% to $7 million, and non-GAAP diluted EPS fell by 7% to $0.13. Key metrics included a gross dollar volume increase to $33.5 billion and a slight rise in active accounts to 3.46 million. Green Dot's updated financial guidance reflects challenges in its retail division and other economic factors but indicates improved momentum towards year-end.
Green Dot (NYSE: GDOT) ha annunciato i risultati finanziari del terzo trimestre 2024, evidenziando un aumento del 16% nei ricavi operativi totali, arrivando a 409,7 milioni di dollari rispetto al terzo trimestre 2023. L'azienda ha introdotto 'Arc by Green Dot' per concentrarsi sul mercato della finanza integrata. Nonostante una perdita netta GAAP maggiore di 7,8 milioni di dollari (un aumento del 25% rispetto all'anno scorso), Green Dot ha registrato una Crescita del 19% nell'EBITDA rettificato, raggiungendo i 28,3 milioni di dollari. Tuttavia, il reddito netto non GAAP è diminuito del 6% a 7 milioni di dollari, e l'EPS diluito non GAAP è sceso del 7% a 0,13 dollari. Tra i principali indicatori, si segnala un aumento del volume lordo in dollari a 33,5 miliardi di dollari e un leggero incremento degli account attivi a 3,46 milioni. Le previsioni finanziarie aggiornate di Green Dot riflettono le sfide nella sua divisione retail e altri fattori economici, ma indicano un miglioramento nella dinamica verso la fine dell'anno.
Green Dot (NYSE: GDOT) anunció sus resultados financieros del tercer trimestre de 2024, destacando un aumento del 16% en los ingresos operativos totales, alcanzando los 409,7 millones de dólares en comparación con el tercer trimestre de 2023. La empresa introdujo 'Arc by Green Dot' para centrarse en el mercado de finanzas integradas. A pesar de una mayor pérdida neta GAAP de 7,8 millones de dólares (un aumento del 25% en comparación con el año pasado), Green Dot experimentó un crecimiento del 19% en el EBITDA ajustado, alcanzando los 28,3 millones de dólares. Sin embargo, el ingreso neto no GAAP disminuyó un 6% a 7 millones de dólares, y el EPS diluido no GAAP cayó un 7% a 0,13 dólares. Las métricas clave incluyeron un aumento en el volumen bruto en dólares a 33,5 mil millones de dólares y un leve aumento en las cuentas activas a 3,46 millones. La orientación financiera actualizada de Green Dot refleja los desafíos en su división minorista y otros factores económicos, pero indica un mejor impulso hacia el final del año.
그린닷(Green Dot, NYSE: GDOT)은 2024년 3분기 재무 결과를 발표하며 총 운영 수익이 16% 증가한 4억 970만 달러에 달했다고 강조했습니다. 이 회사는 임베디드 금융 시장에 초점을 맞추기 위해 'Arc by Green Dot'을 도입했습니다. 지난해보다 25% 증가한 780만 달러의 GAAP 순손실이 발생했음에도 불구하고 그린닷은 조정된 EBITDA가 19% 성장하여 2830만 달러에 이르렀습니다. 그러나 비GAAP 순이익은 6% 감소해 700만 달러에 부딪혔고, 비GAAP 희석 EPS는 7% 감소해 0.13달러에 머물렀습니다. 주요 지표에는 총 335억 달러의 증가와 함께 활성 계정이 346만으로 소폭 증가했습니다. 그린닷의 업데이트된 재무 가이던스는 소매 부문의 도전과 다른 경제적 요인을 반영하는 동시에 연말로 향하는 개선된 모멘텀을 나타냅니다.
Green Dot (NYSE: GDOT) a annoncé ses résultats financiers du troisième trimestre 2024, mettant en évidence une augmentation de 16% des revenus d'exploitation totaux atteignant 409,7 millions de dollars par rapport au troisième trimestre 2023. L'entreprise a lancé 'Arc by Green Dot' pour se concentrer sur le marché des finances intégrées. Malgré une perte nette GAAP plus importante de 7,8 millions de dollars (une augmentation de 25% par rapport à l'année dernière), Green Dot a connu une croissance de 19% de l'EBITDA ajusté, atteignant 28,3 millions de dollars. Cependant, le revenu net non GAAP a diminué de 6% à 7 millions de dollars, et le BPA dilué non GAAP a chuté de 7% à 0,13 dollar. Les indicateurs clés comprenaient une augmentation du volume brut en dollars à 33,5 milliards de dollars et une légère augmentation des comptes actifs à 3,46 millions. Les prévisions financières mises à jour de Green Dot reflètent les défis dans sa division de vente au détail et d'autres facteurs économiques, mais indiquent une dynamique améliorée à l'approche de la fin de l'année.
Green Dot (NYSE: GDOT) hat seine Finanzergebnisse für das 3. Quartal 2024 veröffentlicht und hebt einen Umsatzanstieg von 16% auf 409,7 Millionen Dollar im Vergleich zum 3. Quartal 2023 hervor. Das Unternehmen hat 'Arc by Green Dot' eingeführt, um sich auf den eingebetteten Finanzmarkt zu konzentrieren. Trotz eines höheren GAAP-Nettoverlusts von 7,8 Millionen Dollar (ein Anstieg von 25% im Vergleich zum Vorjahr) verzeichnete Green Dot ein Wachstum des bereinigten EBITDA um 19% auf 28,3 Millionen Dollar. Allerdings sank das Nicht-GAAP-Nettoeinkommen um 6% auf 7 Millionen Dollar, und das verwässerte EPS nach Nicht-GAAP fiel um 7% auf 0,13 Dollar. Zu den wichtigen Kennzahlen gehörte ein Anstieg des Bruttodollarvolumens auf 33,5 Milliarden Dollar und ein leichter Anstieg der aktiven Konten auf 3,46 Millionen. Die aktualisierte Finanzprognose von Green Dot spiegelt die Herausforderungen in der Einzelhandelsabteilung und andere wirtschaftliche Faktoren wider, deutet jedoch auf eine verbesserte Dynamik zum Jahresende hin.
- Total operating revenues increased by 16% to $409.7 million.
- Adjusted EBITDA grew by 19% to $28.3 million.
- Gross dollar volume rose to $33.5 billion.
- Slight rise in active accounts to 3.46 million.
- GAAP net loss increased by 25% to $7.8 million.
- Non-GAAP net income declined by 6% to $7 million.
- Non-GAAP diluted EPS fell by 7% to $0.13.
- Retail division performance fell short of expectations.
Company Introduces "Arc by Green Dot" Iterating Focus on Embedded Finance Market
“It was a solid quarter of execution, and we are excited about the launch of our embedded finance brand, Arc by Green Dot, signifying our commitment to this sizable market where we believe ample opportunity for long-term growth exists,” said George Gresham, Chief Executive Officer of Green Dot. “While our GAAP net loss was larger than last year, we returned to adjusted EBITDA growth in the quarter, which we believe is evidence of our progress on efforts to position Green Dot as a market leader with predictable financial performance and operational excellence.”
Consolidated Results Summary
|
Three Months Ended September 30, |
|
|
|
Nine Months Ended September 30, |
|
|
||||||||||||||
|
2024 |
|
2023 |
|
% Change |
|
2024 |
|
2023 |
|
% Change |
||||||||||
|
(In thousands, except per share data and percentages) |
|
|
||||||||||||||||||
GAAP financial results |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total operating revenues |
$ |
409,743 |
|
|
$ |
353,029 |
|
|
16 |
% |
|
$ |
1,268,852 |
|
|
$ |
1,135,285 |
|
|
12 |
% |
Net (loss) income |
$ |
(7,840 |
) |
|
$ |
(6,265 |
) |
|
25 |
% |
|
$ |
(31,805 |
) |
|
$ |
30,325 |
|
|
(205 |
)% |
Diluted (loss) earnings per common share |
$ |
(0.15 |
) |
|
$ |
(0.12 |
) |
|
25 |
% |
|
$ |
(0.60 |
) |
|
$ |
0.58 |
|
|
(203 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Non-GAAP financial results1 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Non-GAAP total operating revenues1 |
$ |
406,019 |
|
|
$ |
348,571 |
|
|
16 |
% |
|
$ |
1,255,998 |
|
|
$ |
1,122,078 |
|
|
12 |
% |
Adjusted EBITDA1 |
$ |
28,315 |
|
|
$ |
23,735 |
|
|
19 |
% |
|
$ |
121,545 |
|
|
$ |
145,147 |
|
|
(16 |
)% |
Adjusted EBITDA/Non-GAAP total operating revenues (adjusted EBITDA margin) |
|
7.0 |
% |
|
|
6.8 |
% |
|
0.2 |
% |
|
|
9.7 |
% |
|
|
12.9 |
% |
|
(3.2 |
)% |
Non-GAAP net income1 |
$ |
6,988 |
|
|
$ |
7,442 |
|
|
(6 |
)% |
|
$ |
51,814 |
|
|
$ |
77,889 |
|
|
(33 |
)% |
Non-GAAP diluted earnings per share1 |
$ |
0.13 |
|
|
$ |
0.14 |
|
|
(7 |
)% |
|
$ |
0.96 |
|
|
$ |
1.49 |
|
|
(36 |
)% |
Unencumbered cash at the holding company was approximately
Key Metrics
The following table shows Green Dot's quarterly key business metrics for each of the last seven calendar quarters on a consolidated basis and by each of its reportable segments. Please refer to Green Dot’s latest Annual Report on Form 10-K for a description of the key business metrics, as well as additional information regarding how Green Dot organizes its business by segment.
|
2024 |
|
2023 |
|||||||||||||||||
|
Q3 |
|
Q2 |
|
Q1 |
|
Q4 |
|
Q3 |
|
Q2 |
|
Q1 |
|||||||
|
(In millions) |
|||||||||||||||||||
Consolidated * |
|
|
|
|
|
|
|
|
||||||||||||
Gross dollar volume |
$ |
33,473 |
$ |
32,130 |
$ |
30,755 |
|
$ |
26,355 |
$ |
24,836 |
$ |
24,724 |
$ |
23,289 |
|||||
Number of active accounts |
|
3.46 |
|
3.41 |
|
3.51 |
|
|
3.57 |
|
3.67 |
|
3.71 |
|
3.84 |
|||||
Purchase volume |
$ |
4,887 |
$ |
5,012 |
$ |
5,274 |
|
$ |
5,273 |
$ |
5,362 |
$ |
5,734 |
$ |
6,145 |
|||||
Consumer Services |
|
|
|
|
|
|
|
|
||||||||||||
Gross dollar volume |
$ |
3,983 |
$ |
4,014 |
$ |
4,500 |
|
$ |
4,290 |
$ |
4,619 |
$ |
5,122 |
$ |
5,677 |
|||||
Number of active accounts |
|
1.78 |
|
1.76 |
|
1.93 |
|
|
2.05 |
|
2.16 |
|
2.35 |
|
2.41 |
|||||
Direct deposit active accounts |
|
0.44 |
|
0.45 |
|
0.46 |
|
|
0.49 |
|
0.52 |
|
0.59 |
|
0.60 |
|||||
Purchase volume |
$ |
2,904 |
$ |
3,036 |
$ |
3,339 |
|
$ |
3,312 |
$ |
3,553 |
$ |
3,984 |
$ |
4,344 |
|||||
B2B Services |
|
|
|
|
|
|
|
|
||||||||||||
Gross dollar volume |
$ |
29,490 |
$ |
28,116 |
$ |
26,255 |
|
$ |
22,065 |
$ |
20,217 |
$ |
19,602 |
$ |
17,612 |
|||||
Number of active accounts |
|
1.68 |
|
1.65 |
|
1.58 |
|
|
1.52 |
|
1.51 |
|
1.36 |
|
1.43 |
|||||
Purchase volume |
$ |
1,983 |
$ |
1,976 |
$ |
1,935 |
|
$ |
1,961 |
$ |
1,809 |
$ |
1,750 |
$ |
1,801 |
|||||
Money Movement |
|
|
|
|
|
|
|
|
||||||||||||
Number of cash transfers |
|
8.22 |
|
8.15 |
|
7.77 |
|
|
8.19 |
|
8.31 |
|
8.66 |
|
8.70 |
|||||
Number of tax refunds processed |
|
0.19 |
|
4.20 |
|
9.28 |
|
|
0.16 |
|
0.20 |
|
3.87 |
|
9.91 |
* Represents the sum of Green Dot's Consumer Services and B2B (as defined herein) Services segments.
“It was a solid quarter and we are seeing the benefits of our efforts to improve our cost structure, support existing customers and launch new partners such as PLS,” said Jess Unruh, Chief Financial Officer of Green Dot. “While our retail division has seen improved performance, it is falling short of the improvement that we had expected, which is impacting our guidance for the rest of the year. Nonetheless, I am encouraged by the fact that our revised guidance still points to improved momentum as we exit the year.”
2024 Financial Guidance
Green Dot has updated its most recent financial outlook for 2024. Green Dot’s outlook is based on a number of assumptions that management believes are reasonable at the time of this earnings release. In particular, its outlook reflects several considerations, including but not limited to the current macro-economic environment, the effect of inflation and interest rates, the impact of previously disclosed non-renewals of certain partnerships and programs, the company's decision to wind down many of its legacy cardholder programs in support of GO2bank, negative trends within certain channels of its business, investment in strategic initiatives and compliance programs, and cost reduction initiatives. Additionally, the civil money penalty and related expenses associated with Green Dot's consent order previously disclosed are expressly excluded from its non-GAAP measures and related financial outlook. Information regarding potential risks that could cause the actual results to differ from these forward-looking statements is set forth below and in Green Dot's filings with the Securities and Exchange Commission.
Total Non-GAAP Operating Revenues2
-
Green Dot now expects its guidance range for its full year non-GAAP total operating revenues2 to be between
and$1.65 billion , or up approximately$1.70 billion 13% year over year at the mid-point.
Adjusted EBITDA2
-
Green Dot now expects its full year adjusted EBITDA2 range to be between
and$164 million , or down approximately$166 million 3% year over year at the mid-point.
Non-GAAP EPS2
-
Green Dot now expects its full year non-GAAP EPS2 range to be between
and$1.33 , or down$1.36 17% year over year at the mid-point.
The components of Green Dot's non-GAAP EPS2 guidance range are as follows:
|
Range |
||||||
|
Low |
|
High |
||||
|
(In millions, except per share data) |
||||||
Adjusted EBITDA |
$ |
164.0 |
|
|
$ |
166.0 |
|
Depreciation and amortization* |
|
(63.5 |
) |
|
|
(63.5 |
) |
Net interest expense |
|
(5.3 |
) |
|
|
(5.3 |
) |
Non-GAAP pre-tax income |
$ |
95.2 |
|
|
$ |
97.2 |
|
Tax impact** |
|
(22.8 |
) |
|
|
(23.3 |
) |
Non-GAAP net income |
$ |
72.4 |
|
|
$ |
73.9 |
|
Diluted weighted-average shares issued and outstanding |
|
54.2 |
|
|
|
54.2 |
|
Non-GAAP earnings per share |
$ |
1.33 |
|
|
$ |
1.36 |
|
* |
Excludes the impact of amortization of acquired intangible assets |
** |
Assumes a non-GAAP effective tax rate of approximately |
1 |
Reconciliations of total operating revenues to non-GAAP total operating revenues, net income to adjusted EBITDA, net income to non-GAAP net income, and diluted earnings per share to non-GAAP diluted earnings per share, respectively, are provided in the tables immediately following the unaudited consolidated financial statements. Additional information about the Company's non-GAAP financial measures can be found under the caption “About Non-GAAP Financial Measures” below. |
|
2 |
For additional information, see reconciliations of forward-looking guidance for these non-GAAP financial measures to their respective, most directly comparable projected GAAP financial measures provided in the tables immediately following the reconciliation of Net Income to Adjusted EBITDA. |
Conference Call
Green Dot's management will host a conference call to discuss third quarter 2024 financial results today at 5:00 p.m. ET. The conference call can be accessed live from Green Dot's investor relations website at http://ir.greendot.com/. Green Dot uses this website as a tool to disclose important information about the company to investors and comply with its disclosure obligations under Regulation Fair Disclosure. A replay of the webcast will be available at the same website following the call. The replay will be available until Thursday, November 14, 2024.
Forward-Looking Statements
This earnings release 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 in the quotes of Green Dot's executive officers and under the heading "2024 Financial Guidance," and other future events that involve risks and uncertainties. Actual results may differ materially from those contained in the forward-looking statements contained in this earnings release, and reported results should not be considered as an indication of future performance. The potential risks and uncertainties that could cause actual results to differ from those projected include, among other things, Green Dot’s ability to achieve the expected cost savings and other benefits from its processor conversions, impacts from and changes in general economic conditions on Green Dot’s business, results of operations and financial condition, shifts in consumer behavior towards electronic payments, the timing and impact of revenue growth activities, Green Dot's dependence on revenues derived from Walmart or other large partners, the timing and impact of non-renewals or terminations of agreements with other large partners, impact of competition, Green Dot's reliance on retail distributors for the promotion of its products and services, demand for Green Dot's new and existing products and services, continued and improving returns from Green Dot's investments in strategic initiatives, Green Dot's ability to operate in a highly regulated environment, including with respect to any restrictions imposed on its business, changes to governmental policies or rulemaking or enforcement priorities affecting financial institutions or to existing laws or regulations affecting Green Dot's operating methods or economics, Green Dot's reliance on third-party vendors, changes in credit card association or other network rules or standards, changes in card association and debit network fees or products or interchange rates, instances of fraud developments in the financial services industry that impact debit card usage generally, business interruption or systems failure, economic, political and other conditions may adversely affect trends in consumer spending and Green Dot's involvement in litigation or investigations. These and other risks are discussed in greater detail in Green Dot's Securities and Exchange Commission filings, including its most recent annual report on Form 10-K available on Green Dot's investor relations website at ir.greendot.com and on the SEC website at www.sec.gov. All information provided in this release and in the attachments is as of November 7, 2024, and Green Dot assumes no obligation to update this information as a result of future events or developments, except as required by law.
About Non-GAAP Financial Measures
To supplement Green Dot's consolidated financial statements presented in accordance with accounting principles generally accepted in
About Green Dot
Green Dot Corporation (NYSE: GDOT) is a financial technology and registered bank holding company committed to giving all people the power to bank seamlessly, affordably, and with confidence. Green Dot’s technology platform enables it to build products and features that address the most pressing financial challenges of consumers and businesses, transforming the way they manage and move money and making financial empowerment more accessible for all.
Green Dot offers a broad set of financial products to consumers and businesses including debit, checking, credit, prepaid, and payroll cards, as well as robust money processing services, such as tax refunds, cash deposits and disbursements. Its flagship digital banking platform GO2bank offers consumers simple and accessible mobile banking designed to help improve financial health over time. The company’s banking platform services business enables a growing list of the world’s largest and most trusted consumer and technology brands to deploy customized, seamless, value-driven money management solutions for their customers.
Founded in 1999, Green Dot has served more than 33 million customers directly and many millions more through its partners. The Green Dot Network of more than 90,000 retail distribution locations nationwide, more than all remaining bank branches in the
GREEN DOT CORPORATION CONSOLIDATED BALANCE SHEETS |
|||||||
|
|
|
|
||||
|
September 30, 2024 |
|
December 31, 2023 |
||||
|
(unaudited) |
|
|
||||
Assets |
(In thousands, except par value) |
||||||
Current assets: |
|
|
|
||||
Unrestricted cash and cash equivalents |
$ |
1,453,549 |
|
|
$ |
682,263 |
|
Restricted cash |
|
44 |
|
|
|
4,239 |
|
Investment securities available-for-sale, at fair value |
|
43,257 |
|
|
|
33,859 |
|
Settlement assets |
|
587,106 |
|
|
|
737,989 |
|
Accounts receivable, net |
|
84,635 |
|
|
|
110,141 |
|
Prepaid expenses and other assets |
|
49,459 |
|
|
|
69,419 |
|
Income tax receivable |
|
1,322 |
|
|
|
— |
|
Total current assets |
|
2,219,372 |
|
|
|
1,637,910 |
|
Investment securities available-for-sale, at fair value |
|
2,120,803 |
|
|
|
2,203,142 |
|
Loans to bank customers, net of allowance for credit losses of |
|
33,380 |
|
|
|
30,534 |
|
Prepaid expenses and other assets |
|
193,791 |
|
|
|
221,656 |
|
Property, equipment, and internal-use software, net |
|
181,386 |
|
|
|
179,376 |
|
Operating lease right-of-use assets |
|
3,801 |
|
|
|
5,342 |
|
Deferred expenses |
|
1,226 |
|
|
|
1,546 |
|
Net deferred tax assets |
|
128,263 |
|
|
|
117,139 |
|
Goodwill and intangible assets |
|
403,265 |
|
|
|
420,477 |
|
Total assets |
$ |
5,285,287 |
|
|
$ |
4,817,122 |
|
Liabilities and Stockholders’ Equity |
|
|
|
||||
Current liabilities: |
|
|
|
||||
Accounts payable |
$ |
95,043 |
|
|
$ |
119,870 |
|
Deposits |
|
3,837,906 |
|
|
|
3,293,603 |
|
Obligations to customers |
|
215,588 |
|
|
|
314,278 |
|
Settlement obligations |
|
50,821 |
|
|
|
57,001 |
|
Amounts due to card issuing banks for overdrawn accounts |
|
84 |
|
|
|
225 |
|
Other accrued liabilities |
|
94,844 |
|
|
|
91,239 |
|
Operating lease liabilities |
|
2,118 |
|
|
|
3,369 |
|
Deferred revenue |
|
7,181 |
|
|
|
6,343 |
|
Line of credit |
|
— |
|
|
|
61,000 |
|
Income tax payable |
|
2,497 |
|
|
|
6,262 |
|
Total current liabilities |
|
4,306,082 |
|
|
|
3,953,190 |
|
Other accrued liabilities |
|
1,217 |
|
|
|
1,895 |
|
Operating lease liabilities |
|
2,068 |
|
|
|
2,687 |
|
Notes payable |
|
43,675 |
|
|
|
— |
|
Total liabilities |
|
4,353,042 |
|
|
|
3,957,772 |
|
|
|
|
|
||||
Stockholders’ equity: |
|
|
|
||||
Class A common stock, |
|
54 |
|
|
|
53 |
|
Additional paid-in capital |
|
400,769 |
|
|
|
375,980 |
|
Retained earnings |
|
738,499 |
|
|
|
770,304 |
|
Accumulated other comprehensive loss |
|
(207,077 |
) |
|
|
(286,987 |
) |
Total stockholders’ equity |
|
932,245 |
|
|
|
859,350 |
|
Total liabilities and stockholders’ equity |
$ |
5,285,287 |
|
|
$ |
4,817,122 |
|
GREEN DOT CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) |
|||||||||||||||
|
|
|
|
||||||||||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
|
(In thousands, except per share data) |
||||||||||||||
Operating revenues: |
|
|
|
|
|
|
|
||||||||
Card revenues and other fees |
$ |
310,372 |
|
|
$ |
253,407 |
|
|
$ |
878,002 |
|
|
$ |
735,380 |
|
Cash processing revenues |
|
34,897 |
|
|
|
36,256 |
|
|
|
198,447 |
|
|
|
191,925 |
|
Interchange revenues |
|
48,397 |
|
|
|
54,968 |
|
|
|
148,950 |
|
|
|
178,950 |
|
Interest income, net |
|
16,077 |
|
|
|
8,398 |
|
|
|
43,453 |
|
|
|
29,030 |
|
Total operating revenues |
|
409,743 |
|
|
|
353,029 |
|
|
|
1,268,852 |
|
|
|
1,135,285 |
|
Operating expenses: |
|
|
|
|
|
|
|
||||||||
Sales and marketing expenses |
|
52,626 |
|
|
|
56,495 |
|
|
|
167,948 |
|
|
|
194,530 |
|
Compensation and benefits expenses |
|
61,795 |
|
|
|
59,168 |
|
|
|
189,967 |
|
|
|
192,934 |
|
Processing expenses |
|
228,227 |
|
|
|
162,375 |
|
|
|
631,789 |
|
|
|
460,555 |
|
Other general and administrative expenses |
|
70,027 |
|
|
|
81,830 |
|
|
|
295,193 |
|
|
|
238,324 |
|
Total operating expenses |
|
412,675 |
|
|
|
359,868 |
|
|
|
1,284,897 |
|
|
|
1,086,343 |
|
Operating (loss) income |
|
(2,932 |
) |
|
|
(6,839 |
) |
|
|
(16,045 |
) |
|
|
48,942 |
|
Interest expense, net |
|
1,577 |
|
|
|
239 |
|
|
|
4,306 |
|
|
|
2,121 |
|
Other expense, net |
|
(3,705 |
) |
|
|
(802 |
) |
|
|
(10,045 |
) |
|
|
(6,050 |
) |
(Loss) income before income taxes |
|
(8,214 |
) |
|
|
(7,880 |
) |
|
|
(30,396 |
) |
|
|
40,771 |
|
Income tax (benefit) expense |
|
(374 |
) |
|
|
(1,615 |
) |
|
|
1,409 |
|
|
|
10,446 |
|
Net (loss) income |
$ |
(7,840 |
) |
|
$ |
(6,265 |
) |
|
$ |
(31,805 |
) |
|
$ |
30,325 |
|
|
|
|
|
|
|
|
|
||||||||
Basic (loss) earnings per common share: |
$ |
(0.15 |
) |
|
$ |
(0.12 |
) |
|
$ |
(0.60 |
) |
|
$ |
0.58 |
|
Diluted (loss) earnings per common share |
$ |
(0.15 |
) |
|
$ |
(0.12 |
) |
|
$ |
(0.60 |
) |
|
$ |
0.58 |
|
Basic weighted-average common shares issued and outstanding: |
|
53,722 |
|
|
|
52,367 |
|
|
|
53,373 |
|
|
|
52,127 |
|
Diluted weighted-average common shares issued and outstanding: |
|
53,722 |
|
|
|
52,367 |
|
|
|
53,373 |
|
|
|
52,436 |
|
GREEN DOT CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) |
|||||||
|
|
||||||
|
Nine Months Ended September 30, |
||||||
|
2024 |
|
2023 |
||||
|
(In thousands) |
||||||
Operating activities |
|
|
|
||||
Net (loss) income |
$ |
(31,805 |
) |
|
$ |
30,325 |
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities: |
|
|
|
||||
Depreciation and amortization of property, equipment and internal-use software |
|
47,732 |
|
|
|
42,306 |
|
Amortization of intangible assets |
|
16,295 |
|
|
|
18,593 |
|
Provision for uncollectible overdrawn accounts from purchase transactions |
|
15,509 |
|
|
|
7,356 |
|
Provision for loan losses |
|
22,471 |
|
|
|
21,404 |
|
Stock-based compensation |
|
24,059 |
|
|
|
27,732 |
|
Losses in equity method investments |
|
11,931 |
|
|
|
9,286 |
|
Amortization of discount on available-for-sale investment securities |
|
(1,614 |
) |
|
|
(1,724 |
) |
Impairment of long-lived assets |
|
4,944 |
|
|
|
— |
|
Other |
|
(1,810 |
) |
|
|
(3,128 |
) |
Changes in operating assets and liabilities: |
|
|
|
||||
Accounts receivable, net |
|
9,997 |
|
|
|
1,081 |
|
Prepaid expenses and other assets |
|
16,024 |
|
|
|
8,385 |
|
Deferred expenses |
|
320 |
|
|
|
12,946 |
|
Accounts payable and other accrued liabilities |
|
(24,534 |
) |
|
|
(15,505 |
) |
Deferred revenue |
|
157 |
|
|
|
(19,363 |
) |
Income tax receivable/payable |
|
(4,803 |
) |
|
|
(7,859 |
) |
Other, net |
|
(478 |
) |
|
|
613 |
|
Net cash provided by operating activities |
|
104,395 |
|
|
|
132,448 |
|
|
|
|
|
||||
Investing activities |
|
|
|
||||
Purchases of available-for-sale investment securities |
|
(11,845 |
) |
|
|
— |
|
Proceeds from maturities of available-for-sale securities |
|
154,682 |
|
|
|
131,559 |
|
Proceeds from sales and calls of available-for-sale securities |
|
273 |
|
|
|
197 |
|
Payments for property, equipment and internal-use software |
|
(52,168 |
) |
|
|
(55,501 |
) |
Net changes in loans |
|
(24,366 |
) |
|
|
(21,562 |
) |
Investment in TailFin Labs, LLC |
|
(35,000 |
) |
|
|
(35,000 |
) |
Proceeds from other investments |
|
55,088 |
|
|
|
— |
|
Other investing activities |
|
(846 |
) |
|
|
(1,273 |
) |
Net cash provided by investing activities |
|
85,818 |
|
|
|
18,420 |
|
|
|
|
|
||||
Financing activities |
|
|
|
||||
Borrowings on notes payable |
|
44,551 |
|
|
|
— |
|
Borrowings on revolving line of credit |
|
238,000 |
|
|
|
153,000 |
|
Repayments on revolving line of credit |
|
(299,000 |
) |
|
|
(161,000 |
) |
Proceeds from exercise of options and ESPP purchases |
|
2,719 |
|
|
|
3,415 |
|
Taxes paid related to net share settlement of equity awards |
|
(1,988 |
) |
|
|
(3,500 |
) |
Net changes in deposits |
|
547,477 |
|
|
|
(238,417 |
) |
Net changes in settlement assets and obligations to customers |
|
46,013 |
|
|
|
(8,776 |
) |
Deferred financing costs |
|
(894 |
) |
|
|
— |
|
Net cash provided by (used in) financing activities |
|
576,878 |
|
|
|
(255,278 |
) |
|
|
|
|
||||
Net increase (decrease) in unrestricted cash, cash equivalents and restricted cash |
|
767,091 |
|
|
|
(104,410 |
) |
Unrestricted cash, cash equivalents and restricted cash, beginning of period |
|
686,502 |
|
|
|
819,845 |
|
Unrestricted cash, cash equivalents and restricted cash, end of period |
$ |
1,453,593 |
|
|
$ |
715,435 |
|
|
|
|
|
||||
Cash paid for interest |
$ |
9,896 |
|
|
$ |
3,615 |
|
Cash paid for income taxes |
$ |
6,003 |
|
|
$ |
17,100 |
|
|
|
|
|
||||
Reconciliation of unrestricted cash, cash equivalents and restricted cash at end of period: |
|
|
|
||||
Unrestricted cash and cash equivalents |
$ |
1,453,549 |
|
|
$ |
711,399 |
|
Restricted cash |
|
44 |
|
|
|
4,036 |
|
Total unrestricted cash, cash equivalents and restricted cash, end of period |
$ |
1,453,593 |
|
|
$ |
715,435 |
|
GREEN DOT CORPORATION REPORTABLE SEGMENTS (UNAUDITED) |
|||||||||||||||
|
|
|
|
||||||||||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
Segment Revenue |
(In thousands) |
||||||||||||||
Consumer Services |
$ |
98,046 |
|
|
$ |
118,204 |
|
|
$ |
295,278 |
|
|
$ |
387,128 |
|
B2B Services |
|
276,402 |
|
|
|
199,206 |
|
|
|
769,658 |
|
|
|
551,150 |
|
Money Movement Services |
|
31,854 |
|
|
|
32,089 |
|
|
|
187,967 |
|
|
|
180,304 |
|
Corporate and Other |
|
(283 |
) |
|
|
(928 |
) |
|
|
3,095 |
|
|
|
3,496 |
|
Total segment revenues |
|
406,019 |
|
|
|
348,571 |
|
|
|
1,255,998 |
|
|
|
1,122,078 |
|
BaaS commissions and processing expenses (8) |
|
4,346 |
|
|
|
5,168 |
|
|
|
14,492 |
|
|
|
15,346 |
|
Other income (9) |
|
(622 |
) |
|
|
(710 |
) |
|
|
(1,638 |
) |
|
|
(2,139 |
) |
Total operating revenues |
$ |
409,743 |
|
|
$ |
353,029 |
|
|
$ |
1,268,852 |
|
|
$ |
1,135,285 |
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
Segment Profit |
(In thousands) |
||||||||||||||
Consumer Services |
$ |
39,389 |
|
|
$ |
42,426 |
|
|
$ |
107,097 |
|
|
$ |
139,450 |
|
B2B Services |
|
27,736 |
|
|
|
18,883 |
|
|
|
65,097 |
|
|
|
58,808 |
|
Money Movement Services |
|
12,717 |
|
|
|
12,850 |
|
|
|
113,855 |
|
|
|
103,650 |
|
Corporate and Other |
|
(51,527 |
) |
|
|
(50,424 |
) |
|
|
(164,504 |
) |
|
|
(156,761 |
) |
Total segment profit * |
|
28,315 |
|
|
|
23,735 |
|
|
|
121,545 |
|
|
|
145,147 |
|
Reconciliation to (loss) income before income taxes |
|
|
|
|
|
|
|
||||||||
Depreciation and amortization of property, equipment and internal-use software |
|
15,473 |
|
|
|
14,720 |
|
|
|
47,732 |
|
|
|
42,307 |
|
Stock based compensation and related employer taxes |
|
8,210 |
|
|
|
7,966 |
|
|
|
24,429 |
|
|
|
28,255 |
|
Amortization of acquired intangible assets |
|
5,246 |
|
|
|
5,648 |
|
|
|
16,295 |
|
|
|
18,593 |
|
Impairment charges |
|
8 |
|
|
|
— |
|
|
|
8,528 |
|
|
|
— |
|
Legal settlements and related expenses |
|
869 |
|
|
|
545 |
|
|
|
32,896 |
|
|
|
1,964 |
|
Other expense |
|
1,441 |
|
|
|
1,695 |
|
|
|
7,710 |
|
|
|
5,086 |
|
Operating (loss) income |
|
(2,932 |
) |
|
|
(6,839 |
) |
|
|
(16,045 |
) |
|
|
48,942 |
|
Interest expense, net |
|
1,577 |
|
|
|
239 |
|
|
|
4,306 |
|
|
|
2,121 |
|
Other expense, net |
|
(3,705 |
) |
|
|
(802 |
) |
|
|
(10,045 |
) |
|
|
(6,050 |
) |
(Loss) income before income taxes |
$ |
(8,214 |
) |
|
$ |
(7,880 |
) |
|
$ |
(30,396 |
) |
|
$ |
40,771 |
|
* Total segment profit is also referred to herein as adjusted EBITDA in its non-GAAP measures. Additional information about the Company's non-GAAP financial measures can be found under the caption “About Non-GAAP Financial Measures."
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 on the basis of the channels in which its product and services are offered and uses net revenue and segment profit to assess profitability. Segment profit reflects each segment's net revenue less direct costs, such as sales and marketing expenses, processing expenses, third-party call center support and transaction losses. Green Dot’s operations are aggregated amongst three reportable segments: 1) Consumer Services, 2) Business to Business ("B2B") Services and 3) Money Movement Services.
The Corporate and Other segment primarily consists of net interest income, certain other investment income earned by Green Dot's bank, interest profit sharing arrangements with certain BaaS partners (a reduction of revenue), eliminations of inter-segment revenues and expenses, and unallocated corporate expenses, which include Green Dot's fixed expenses, such as salaries, wages and related benefits for its employees, professional services fees, software licenses, telephone and communication costs, rent, utilities, and insurance that are not considered when Green Dot's CODM evaluates segment performance. Non-cash expenses such as stock-based compensation, depreciation and amortization of long-lived assets, impairment charges and other non-recurring expenses that are not considered by Green Dot's CODM when it is evaluating overall consolidated financial results are excluded from its unallocated corporate expenses. Green Dot does not evaluate performance or allocate resources based on segment asset data, and therefore such information is not presented.
GREEN DOT CORPORATION Reconciliation of Total Operating Revenues to Non-GAAP Total Operating Revenues (1) (Unaudited) |
|||||||||||||||
|
|
|
|
||||||||||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
|
(In thousands) |
||||||||||||||
Total operating revenues |
$ |
409,743 |
|
|
$ |
353,029 |
|
|
$ |
1,268,852 |
|
|
$ |
1,135,285 |
|
BaaS commissions and processing expenses (8) |
|
(4,346 |
) |
|
|
(5,168 |
) |
|
|
(14,492 |
) |
|
|
(15,346 |
) |
Other income (9) |
|
622 |
|
|
|
710 |
|
|
|
1,638 |
|
|
|
2,139 |
|
Non-GAAP total operating revenues |
$ |
406,019 |
|
|
$ |
348,571 |
|
|
$ |
1,255,998 |
|
|
$ |
1,122,078 |
|
Reconciliation of Net (Loss) Income to Non-GAAP Net Income (1) (Unaudited) |
|||||||||||||||
|
|
|
|
||||||||||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
|
(In thousands, except per share data) |
||||||||||||||
Net (loss) income |
$ |
(7,840 |
) |
|
$ |
(6,265 |
) |
|
$ |
(31,805 |
) |
|
$ |
30,325 |
|
Stock-based compensation and related employer payroll taxes (3) |
|
8,210 |
|
|
|
7,966 |
|
|
|
24,429 |
|
|
|
28,255 |
|
Amortization of acquired intangible assets (4) |
|
5,246 |
|
|
|
5,648 |
|
|
|
16,295 |
|
|
|
18,593 |
|
Transaction and related acquisition costs (4) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3 |
) |
Amortization of deferred financing costs (5) |
|
54 |
|
|
|
36 |
|
|
|
126 |
|
|
|
108 |
|
Impairment charges (5) |
|
8 |
|
|
|
— |
|
|
|
8,528 |
|
|
|
— |
|
Legal settlements and related expenses (5) |
|
869 |
|
|
|
545 |
|
|
|
32,896 |
|
|
|
1,964 |
|
Losses in equity method investments (5) |
|
4,472 |
|
|
|
1,675 |
|
|
|
11,931 |
|
|
|
9,286 |
|
Change in fair value of loans held for sale (5) |
|
(9 |
) |
|
|
(172 |
) |
|
|
(244 |
) |
|
|
(1,101 |
) |
Extraordinary severance expenses (6) |
|
635 |
|
|
|
984 |
|
|
|
6,072 |
|
|
|
3,415 |
|
Other income, net (5) |
|
48 |
|
|
|
10 |
|
|
|
(4 |
) |
|
|
(461 |
) |
Income tax effect (7) |
|
(4,705 |
) |
|
|
(2,985 |
) |
|
|
(16,410 |
) |
|
|
(12,492 |
) |
Non-GAAP net income |
$ |
6,988 |
|
|
$ |
7,442 |
|
|
$ |
51,814 |
|
|
$ |
77,889 |
|
Diluted (loss) earnings per common share |
|
|
|
|
|
|
|
||||||||
GAAP |
$ |
(0.15 |
) |
|
$ |
(0.12 |
) |
|
$ |
(0.60 |
) |
|
$ |
0.58 |
|
Non-GAAP |
$ |
0.13 |
|
|
$ |
0.14 |
|
|
$ |
0.96 |
|
|
$ |
1.49 |
|
|
|
|
|
|
|
|
|
||||||||
Diluted weighted-average common shares issued and outstanding |
|
|
|
|
|
|
|
||||||||
GAAP |
|
53,722 |
|
|
|
52,367 |
|
|
|
53,373 |
|
|
|
52,436 |
|
Non-GAAP |
|
54,690 |
|
|
|
52,736 |
|
|
|
53,931 |
|
|
|
52,436 |
|
Reconciliation of GAAP to Non-GAAP Diluted Weighted-Average Shares Issued and Outstanding (Unaudited) |
|||||||
|
|
|
|
||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
(In thousands) |
||||||
Diluted weighted-average shares issued and outstanding |
53,722 |
|
52,367 |
|
53,373 |
|
52,436 |
Anti-dilutive shares due to GAAP net loss |
968 |
|
369 |
|
558 |
|
— |
Non-GAAP diluted weighted-average shares issued and outstanding |
54,690 |
|
52,736 |
|
53,931 |
|
52,436 |
GREEN DOT CORPORATION Supplemental Detail on Diluted Weighted-Average Common Shares Issued and Outstanding (Unaudited) |
|||||||||||
|
|
|
|
||||||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||
|
(In thousands) |
||||||||||
Class A common stock outstanding as of September 30: |
53,751 |
|
|
52,415 |
|
|
53,751 |
|
|
52,415 |
|
Weighting adjustment |
(29 |
) |
|
(48 |
) |
|
(378 |
) |
|
(288 |
) |
Dilutive potential shares: |
|
|
|
|
|
|
|
||||
Service based restricted stock units |
913 |
|
|
246 |
|
|
530 |
|
|
173 |
|
Performance-based restricted stock units |
10 |
|
|
67 |
|
|
4 |
|
|
75 |
|
Employee stock purchase plan |
45 |
|
|
56 |
|
|
24 |
|
|
61 |
|
Diluted weighted-average shares issued and outstanding |
54,690 |
|
|
52,736 |
|
|
53,931 |
|
|
52,436 |
|
Reconciliation of Net (Loss) Income to Adjusted EBITDA (1) (Unaudited) |
|||||||||||||||
|
|
|
|
||||||||||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
|
(In thousands) |
||||||||||||||
Net (loss) income |
$ |
(7,840 |
) |
|
$ |
(6,265 |
) |
|
$ |
(31,805 |
) |
|
$ |
30,325 |
|
Interest expense, net (2) |
|
1,577 |
|
|
|
239 |
|
|
|
4,306 |
|
|
|
2,121 |
|
Income tax expense |
|
(374 |
) |
|
|
(1,615 |
) |
|
|
1,409 |
|
|
|
10,446 |
|
Depreciation and amortization of property, equipment and internal-use software (2) |
|
15,473 |
|
|
|
14,720 |
|
|
|
47,732 |
|
|
|
42,307 |
|
Stock-based compensation and related employer payroll taxes (2)(3) |
|
8,210 |
|
|
|
7,966 |
|
|
|
24,429 |
|
|
|
28,255 |
|
Amortization of acquired intangible assets (2)(4) |
|
5,246 |
|
|
|
5,648 |
|
|
|
16,295 |
|
|
|
18,593 |
|
Transaction and related acquisition costs (2)(4) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3 |
) |
Impairment charges (2)(5) |
|
8 |
|
|
|
— |
|
|
|
8,528 |
|
|
|
— |
|
Legal settlements and related expenses (2)(5) |
|
869 |
|
|
|
545 |
|
|
|
32,896 |
|
|
|
1,964 |
|
Losses in equity method investments (2)(5) |
|
4,472 |
|
|
|
1,675 |
|
|
|
11,931 |
|
|
|
9,286 |
|
Change in fair value of loans held for sale (2)(5) |
|
(9 |
) |
|
|
(172 |
) |
|
|
(244 |
) |
|
|
(1,101 |
) |
Extraordinary severance expenses (2)(6) |
|
635 |
|
|
|
984 |
|
|
|
6,072 |
|
|
|
3,415 |
|
Other income, net (2)(5) |
|
48 |
|
|
|
10 |
|
|
|
(4 |
) |
|
|
(461 |
) |
Adjusted EBITDA |
$ |
28,315 |
|
|
$ |
23,735 |
|
|
$ |
121,545 |
|
|
$ |
145,147 |
|
|
|
|
|
|
|
|
|
||||||||
Non-GAAP total operating revenues |
$ |
406,019 |
|
|
$ |
348,571 |
|
|
$ |
1,255,998 |
|
|
$ |
1,122,078 |
|
Adjusted EBITDA/Non-GAAP total operating revenues (adjusted EBITDA margin) |
|
7.0 |
% |
|
|
6.8 |
% |
|
|
9.7 |
% |
|
|
12.9 |
% |
GREEN DOT CORPORATION Reconciliation of Forward Looking Guidance for Non-GAAP Financial Measures to Projected GAAP Total Operating Revenues (1) (Unaudited) |
|||||||
|
|
||||||
|
FY 2024 |
||||||
|
Range |
||||||
|
Low |
|
High |
||||
|
(In millions) |
||||||
Total operating revenues |
$ |
1,669 |
|
|
$ |
1,719 |
|
Adjustments (8)(9) |
|
(19 |
) |
|
|
(19 |
) |
Non-GAAP total operating revenues |
$ |
1,650 |
|
|
$ |
1,700 |
|
Reconciliation of Forward Looking Guidance for Non-GAAP Financial Measures to Projected GAAP Net Loss (1) (Unaudited) |
|||||||
|
|
||||||
|
FY 2024 |
||||||
|
Range |
||||||
|
Low |
|
High |
||||
|
(In millions) |
||||||
Net loss |
$ |
(27.3 |
) |
|
$ |
(24.9 |
) |
Adjustments (10) |
|
191.3 |
|
|
|
190.9 |
|
Adjusted EBITDA |
$ |
164.0 |
|
|
$ |
166.0 |
|
|
|
|
|
||||
Non-GAAP total operating revenues |
$ |
1,700 |
|
|
$ |
1,650 |
|
Adjusted EBITDA/Non-GAAP total operating revenues (adjusted EBITDA margin) |
|
9.6 |
% |
|
|
10.1 |
% |
Reconciliation of Forward Looking Guidance for Non-GAAP Financial Measures to Projected GAAP Net Loss(1) (Unaudited) |
|||||||
|
|
||||||
|
FY 2024 |
||||||
|
Range |
||||||
|
Low |
|
High |
||||
|
(In millions, except per share data) |
||||||
Net loss |
$ |
(27.3 |
) |
|
$ |
(24.9 |
) |
Adjustments (10) |
|
99.7 |
|
|
|
98.8 |
|
Non-GAAP net income |
$ |
72.4 |
|
|
$ |
73.9 |
|
Diluted earnings (loss) per share |
|
|
|
||||
GAAP |
$ |
(0.51 |
) |
|
$ |
(0.46 |
) |
Non-GAAP |
$ |
1.33 |
|
|
$ |
1.36 |
|
|
|
|
|
||||
Diluted weighted-average shares issued and outstanding |
|
|
|
||||
GAAP |
|
53.6 |
|
|
|
53.6 |
|
Anti-dilutive shares due to GAAP net loss |
|
0.6 |
|
|
|
0.6 |
|
Non-GAAP |
|
54.2 |
|
|
|
54.2 |
|
(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 presented in accordance with GAAP and should not be considered as alternatives to or substitutes for operating revenues, operating income, net income or any other measure of financial performance calculated and presented in accordance with GAAP. These financial measures may not be comparable to similarly-titled measures of other organizations because other organizations may not calculate their measures in the same manner as Green Dot does. These financial measures are adjusted to eliminate the impact of items that Green Dot does not consider indicative of its core operating performance. You are encouraged to evaluate these adjustments and the reasons Green Dot considers them appropriate. |
Green Dot believes that the non-GAAP financial measures it presents are useful to investors in evaluating Green Dot’s operating performance for the following reasons:
- adjusted EBITDA is widely used by investors to measure a company’s operating performance without regard to items, such as non-operating net interest income and expense, income tax benefit and expense, depreciation and amortization, stock-based compensation and related employer payroll taxes, changes in the fair value of contingent consideration, transaction costs, impairment charges, extraordinary severance expenses, certain legal settlement and related expenses, earnings or losses from equity method investments, changes in the fair value of loans held for sale, and other charges and income that can vary substantially from company to company depending upon their respective financing structures and accounting policies, the book values of their assets, their capital structures and the methods by which their assets were acquired;
- securities analysts use adjusted EBITDA as a supplemental measure to evaluate the overall operating performance of companies; and
-
Green Dot records stock-based compensation from period to period, and recorded stock-based compensation expenses and related employer payroll taxes, net of forfeitures, of approximately
and$8.2 million for the three months ended September 30, 2024 and 2023, respectively. By comparing Green Dot’s adjusted EBITDA, non-GAAP net income and non-GAAP diluted earnings per share in different historical periods, investors can evaluate Green Dot’s operating results without the additional variations caused by stock-based compensation expense and related employer payroll taxes, which may not be comparable from period to period due to changes in the fair market value of Green Dot’s Class A common stock (which is influenced by external factors like the volatility of the public markets and the financial performance of Green Dot’s peers) and is not a key measure of Green Dot’s operations.$8.0 million
Green Dot’s management uses the non-GAAP financial measures:
- as measures of operating performance, because they exclude the impact of items not directly resulting from Green Dot’s core operations;
- for planning purposes, including the preparation of Green Dot’s annual operating budget;
- to allocate resources to enhance the financial performance of Green Dot’s business;
- to evaluate the effectiveness of Green Dot’s business strategies;
- to establish metrics for variable compensation; and
- in communications with Green Dot’s board of directors concerning Green Dot’s financial performance.
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 in isolation or as substitutes for an analysis of Green Dot’s results of operations as reported under GAAP. Some of these limitations are:
- that these measures do not reflect Green Dot’s capital expenditures or future requirements for capital expenditures or other contractual commitments;
- that these measures do not reflect changes in, or cash requirements for, Green Dot’s working capital needs;
- that these measures do not reflect non-operating interest expense or interest income;
- that these measures do not reflect cash requirements for income taxes;
- that, although depreciation and amortization are non-cash charges, the assets being depreciated or amortized will often have to be replaced in the future, and these measures do not reflect any cash requirements for these replacements; and
- that other companies in Green Dot’s industry may calculate these measures differently than Green Dot does, limiting their usefulness as comparative measures.
(2) |
Green Dot does not include any income tax impact of the associated non-GAAP adjustment to adjusted EBITDA, as the case may be, because each of these adjustments to the non-GAAP financial measure is provided before income tax expense. |
|
(3) |
This expense consists primarily of expenses for restricted stock units (including performance-based restricted stock units) and related employer payroll taxes. Stock-based compensation expense is not comparable from period to period due to changes in the fair market value of Green Dot’s Class A common stock (which is influenced by external factors like the volatility of public markets and the financial performance of Green Dot’s peers) and is not a key measure of Green Dot’s operations. Green Dot excludes stock-based compensation expense from its non-GAAP financial measures primarily because it consists of non-cash expenses that Green Dot does not believe are reflective of ongoing operating results. Green Dot also believes that it is not useful to investors to understand the impact of stock-based compensation to its results of operations. Further, the related employer payroll taxes are dependent upon volatility in Green Dot's stock price, as well as the timing and size of option exercises and vesting of restricted stock units, over which Green Dot has limited to no control. This expense is included as a component of compensation and benefits expenses on Green Dot's consolidated statements of operations. |
|
(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, settlements of contingencies established at time of acquisition and other acquisition related charges, such as integration charges and professional and legal fees, which result in Green Dot recording expenses or fair value adjustments in its GAAP financial statements. Green Dot analyzes the performance of its operations without regard to these adjustments. In determining whether any acquisition-related adjustment is appropriate, Green Dot takes into consideration, among other things, how such adjustments would or would not aid in the understanding of the performance of its operations. These items are included as a component of other general and administrative expenses on Green Dot's consolidated statements of operations, as applicable for the periods presented. |
|
(5) |
Green Dot excludes certain income and expenses that are not reflective of ongoing operating results. It is difficult to estimate the amount or timing of these items in advance. Although these events are reflected in Green Dot's GAAP financial statements, Green Dot excludes them in its non-GAAP financial measures because Green Dot believes these items may limit the comparability of ongoing operations with prior and future periods. These adjustments include items such as amortization attributable to deferred financing costs, impairment charges related to long-lived assets, earnings or losses from equity method investments, legal settlements and related expenses, changes in the fair value of loans held for sale, realized gains on investment securities and other income and expenses, as applicable for the periods presented. In determining whether any such adjustment is appropriate, Green Dot takes into consideration, among other things, how such adjustments would or would not aid in the understanding of the performance of its operations. Each of these adjustments, except for amortization of deferred financing costs, earnings and losses from equity method investments, fair value changes on loans held for sale, and realized gains on investment securities, which are all included below operating income, are included within other general and administrative expenses on Green Dot's consolidated statements of operations. |
|
(6) |
During the three and nine months ended September 30, 2024, Green Dot recorded charges of |
|
(7) |
Represents the tax effect for the related non-GAAP measure adjustments using Green Dot's year to date non-GAAP effective tax rate. It also excludes both the impact of excess tax benefits related to stock-based compensation and the IRC §162(m) limitation that applies to performance-based restricted stock units expense as of September 30, 2024. |
|
(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) |
Represents other non-interest investment income earned by Green Dot Bank. This amount is included along with operating interest income in Green Dot's Corporate and Other segment since the yield earned on these investments are generated on a recurring basis and earned similarly to its investment securities available for sale. |
|
(10) |
These amounts represent estimated adjustments for items such as income taxes, depreciation and amortization, employee stock-based compensation and related employer taxes, amortization attributable to deferred financing costs, impairment charges, extraordinary severance expenses, earnings and losses from equity method investments, changes in the fair value of loans held for sale, legal settlements and related expenses and other income and expenses. Employee stock-based compensation expense includes assumptions about the future fair value of the Company’s Class A common stock (which is influenced by external factors like the volatility of public markets and the financial performance of the Company’s peers). |
View source version on businesswire.com: https://www.businesswire.com/news/home/20241107073773/en/
Investor Relations: IR@greendot.com
Media Relations: PR@greendotcorp.com
Source: Green Dot Corporation
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