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. 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 announced Blockchain.com as a new client during its 2Q23 earnings call in August. The company’s ability to quickly onboard, activate, and expand its relationship to now include SoFi accounts is a strong proof point in Bakkt’s ability to execute. As Blockchain.com grows, so should Bakkt’s business. We could see more partnerships down the road like the one with Blockchain.com. On the 3Q23 earnings call, the company laid out extensive guidance for FY23 and FY24, including revenue, net revenue, operating cash flow usage, and non-GAAP FCF usage. For FY23, midpoint revenue guidance is for a total of $1,009 million (crypto $956 million and loyalty $53 million). For FY24, midpoint revenue guidance is for a total of $6,266 million (crypto $6,213 million and loyalty $53 million). Non-GAAP FCF midpoints are for $100 million usage in FY23 and $53 million usage in FY24, with the improvement driven by cost-control actions already taken and more than 40% net revenue growth in 2024. Bakkt is building a significant backlog of client activity, which it clearly demonstrated this quarter. The foundation laid down in 2023, including deals like Blockchain.com, should directly translate to strong revenue growth in 2024. The company reiterated that it still expects to be approximately break-even on an adjusted EBITDA basis by the end of 2024. View all our fireside chats and reports on Bakkt on our website, including a summary of 3Q23 earnings and an updated model.
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