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Water Tower Research

Research from Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

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<ul><li>Bakkt’s new President and CEO Andy Main led the earnings call, where net revenue of $16.7 million was better than pre-announced, while the GAAP EPS loss of $0.29 was worse than our expectation of a $0.19 loss, driven by higher restructuring and goodwill write-downs.</li><li>While 4Q23 was pretty much old news, Main highlighted how strong tailwinds in 1Q24 have led to significant notional crypto trading volume increases.</li><li>He stated that, “QTD notional traded volumes have been very strong, with March QTD up over ~260% from 4Q23 versus overall market activity up ~65%.”</li></ul>

Bakkt’s new President and CEO Andy Main led the earnings call, where net revenue of $16.7 million was better than pre-announced, while the GAAP EPS loss of $0.29 was worse than our expectation of a $0.19 loss, driven by higher restructuring and goodwill write-downs.While 4Q23 was pretty much old news, Main highlighted how strong tailwinds in 1Q24 have led to significant notional crypto trading volume increases.He stated that, “QTD notional traded volumes have been very strong, with March QTD up over ~260% from 4Q23 versus overall market activity up ~65%.”

Bakkt Holdings, Inc. - New CEO Comments on 4Q23 Earnings and the Way Forward

<ul><li>In its continuing push in international markets, Bakkt announced on January 24 that it activated its crypto capabilities in several new international markets in Asia, Europe, North America, and South America with existing clients Hapi and SogoTrade.</li><li>Bakkt crypto trading is now live in Hong Kong and Singapore with SogoTrade.</li><li>Bakkt is excited about its entry into these markets given the rapid growth in their crypto economies. </li></ul>

In its continuing push in international markets, Bakkt announced on January 24 that it activated its crypto capabilities in several new international markets in Asia, Europe, North America, and South America with existing clients Hapi and SogoTrade.Bakkt crypto trading is now live in Hong Kong and Singapore with SogoTrade.Bakkt is excited about its entry into these markets given the rapid growth in their crypto economies. 

Bakkt Holdings, Inc. - Broadens Latin American Footprint While Entering Asia

<ul><li>On November 29, 2023, Blockchain.com announced it is partnering with SoFi so users can migrate their crypto accounts to the Blockchain.com platform.</li><li>Bakkt provides the platform for Blockchain.com in seven states: HI, LA, NJ, NV, TN, TX, and VA.</li><li>The additional SoFi accounts in these states will come onto the Bakkt platform for crypto trading.</li></ul>

On November 29, 2023, Blockchain.com announced it is partnering with SoFi so users can migrate their crypto accounts to the Blockchain.com platform.Bakkt provides the platform for Blockchain.com in seven states: HI, LA, NJ, NV, TN, TX, and VA.The additional SoFi accounts in these states will come onto the Bakkt platform for crypto trading.

Bakkt Holdings, Inc. - Adding New Accounts as SoFi Migrates to Partner Blockchain.com

<ul><li>Bakkt reported a 3Q23 loss of $0.19/share on net revenue of $14.6 million, slightly below our estimates of a loss of $0.18/share loss on net revenue of $15.5 million (consensus was for a loss of $0.17/share on $16.1 million).</li><li>The crypto environment continues to be challenging. President and CEO Gavin Michael said the quarter “clearly demonstrated our ability to execute” in a tough market.</li><li>Michael also highlighted the company’s push and significant progress in expanding outside the US, which is in need of clarifying legislation.</li></ul>

Bakkt reported a 3Q23 loss of $0.19/share on net revenue of $14.6 million, slightly below our estimates of a loss of $0.18/share loss on net revenue of $15.5 million (consensus was for a loss of $0.17/share on $16.1 million).The crypto environment continues to be challenging. President and CEO Gavin Michael said the quarter “clearly demonstrated our ability to execute” in a tough market.Michael also highlighted the company’s push and significant progress in expanding outside the US, which is in need of clarifying legislation.

Bakkt Holdings, Inc. - 3Q23 Earnings Show Solid Execution in a Challenging Environment

<ul><li>On November 9, Bakkt announced the expansion of its international footprint and custody client base.</li><li>Key to its international efforts is expectations to be live with crypto capabilities across new Latin American, European, and Asian markets by year-end.</li><li>CEO Gavin Michael said the company was “working efficiently to expand into international regions with more regulatory clarity and sizeable addressable markets.”</li></ul>

On November 9, Bakkt announced the expansion of its international footprint and custody client base.Key to its international efforts is expectations to be live with crypto capabilities across new Latin American, European, and Asian markets by year-end.CEO Gavin Michael said the company was “working efficiently to expand into international regions with more regulatory clarity and sizeable addressable markets.”

United States

Bakkt Holdings, Inc. operates as a software company. The Company develops digital asset marketplace that enables consumers to buy, sell, store, and spend digital assets. Bakkt Holdings serves customers worldwide.

Bakkt (BKKT US)

Bakkt Holdings, Inc. - New CEO Comments on 4Q23 Earnings and the Way Forward

Bakkt’s new President and CEO Andy Main led the earnings call, where net revenue of $16.7 million was better than pre-announced, while the GAAP EPS...

Water Tower Research

Bakkt Holdings, Inc. - Broadens Latin American Footprint While Entering Asia

In its continuing push in international markets, Bakkt announced on January 24 that it activated its crypto capabilities in several new...

Water Tower Research

Bakkt Holdings, Inc. - Adding New Accounts as SoFi Migrates to Partner Blockchain.com

On November 29, 2023, Blockchain.com announced it is partnering with SoFi so users can migrate their crypto accounts to the Blockchain.com platform.

Water Tower Research

Bakkt Holdings, Inc. - 3Q23 Earnings Show Solid Execution in a Challenging Environment

Michael also highlighted the company’s push and significant progress in expanding outside the US, which is in need of clarifying legislation.

Water Tower Research

UPDATE NOTE - Bakkt Holdings, Inc.

Key to its international efforts is expectations to be live with crypto capabilities across new Latin American, European, and Asian markets by year...

Water Tower Research