Katapult Holdings (KPLT) Q1 2022 earnings summary

Executive summary

• Q1 revenue was $59.9M and net loss was $5.6M, as originations and gross profit declined from stimulus-supported Q1 2021 levels.

• Gross originations fell 26.8% YoY to $46.7M; tighter underwriting amid weaker consumer payment trends contributed to fewer approvals.

Financial highlights

• Revenue declined 25.7% YoY to $59.9M; gross profit fell 57.6% to $11.8M.

• Operating loss was $4.8M vs. operating income of $14.4M; net loss was $5.6M vs. net income of $8.1M.

• A $3.1M warrant-liability fair-value gain partly offset operating and interest costs; interest expense was $3.8M.

• Net cash from operations was $3.7M; cash and restricted cash declined $10.2M to $86.2M, including $80.6M unrestricted cash.

Outlook and guidance

• Challenging macro conditions were expected to persist through 2022; largest merchant partners were expected to return to growth in H2 2022.

• Impairment charges were expected to rise toward pre-pandemic levels; $80.6M unrestricted cash was considered sufficient for liquidity needs over the next 12 months.