Katapult (KPLT) Q4 2024 earnings summary

Executive summary

• Q4 2024 gross originations grew 11.3% year-over-year to $75.2 million, with revenue up 9.4% to $63 million, both exceeding outlooks.

• The business operates a two-sided, AI-powered lease-to-own marketplace, with 61% of Q4 originations starting in the app and 61.5% from repeat customers.

• Customer engagement and satisfaction remain high, with a Net Promoter Score of 58 and strong repeat rates.

• Adjusted EBITDA for 2024 was $4.8 million, marking the first full year of positive adjusted EBITDA since 2021.

• The company targets a $50–60 billion addressable market, focusing on underserved consumers lacking access to traditional credit.

Financial highlights

• Q4 2024 gross originations: $75.2M, up 11.3% year-over-year; revenue: $63.0M, up 9.4% year-over-year.

• Q4 2024 net loss: $9.6M, improved from $14.6M in Q4 2023; adjusted EBITDA loss: $1.1M.

• FY 2024 gross originations: $237M (+4.7%); revenue: $247M (+11.6%); net loss: $26M (improved from $37M); adjusted EBITDA: $5M (vs. $2M loss in 2023).

• Gross margin for 2024 was 18.5%, within the 18%-20% target range, but Q4 margin was 11.8% due to lease depreciation.

• Fixed cash operating expenses in Q4 were $8.4 million, down about 7% year-over-year; total operating expenses fell 37% due to lower litigation costs.

Outlook and guidance

• Q1 2025 guidance: gross originations growth of ~11%, revenue growth of ~10%, and ~$3 million in positive adjusted EBITDA.

• Full-year 2025 guidance: at least 20% growth in both gross originations and revenue, and at least $10 million in positive adjusted EBITDA.

• Gross margin expected to remain in the 18%-20% range for 2025; outlook assumes no material improvement in home furnishings/mattress.

• Management expects write-offs as a percentage of revenue to decrease as vintages mature and credit tightens.

• Focus remains on disciplined growth, leveraging technology, and expanding merchant and consumer bases.