Katapult Holdings, Inc. Q4 FY2024 earnings call

• Transformed from a single input driven business to a multi-dimensional growth engine, launching the Katapult app and KPay feature.
• Consumer engagement: Total app originations in Q4 grew 32% year-over-year, KPay originations were up ~52% year-over-year; added 8 merchants to marketplace based on customer feedback; increased marketing activity with focus on driving application growth and customer lifetime value.
• Merchant engagement: Focused on positioning Katapult as a partner of choice, added over 30 new direct or waterfall merchants or merchant pathways; had co-granted marketing campaigns with merchant partners leading to strong growth; partnered with Self Financial, a global market leader, and a Fintech to expand reach and brand.

In Q4 2024, growth originations grew more than 11% year-over-year, and fourth quarter revenue was up more than 9%. For 2024, total gross originations grew approximately 5%. Q4 revenue was $63 million, a 9.4% growth. Direct and waterfall merchants accounted for approximately 68% of total gross originations in 2024. In Q4, excluding the home furnishings and mattress category, direct and waterfall gross originations grew approximately 44% year-over-year, and for full-year 2024, this metric was up 16%.

• Q1 2025: Expected gross originations growth of approximately 11%, revenue growth of approximately 10%, and approximately $3 million in positive adjusted EBITDA.
• 2025: Expected gross originations growth of at least 20%, revenue growth of at least 20%, and at least $10 million in positive adjusted EBITDA.

• Uncertainty surrounding the ability to secure refinancing of the credit facility and risks related to continuing as a going concern.

Q: Kyle Joseph asked about margin outlook and consumer behavior changes due to tariffs.

A: Nancy Walsh said gross profit would stay in 18%-20% range; Orlando Zayas and Derek Medlin mentioned no direct impact seen yet on consumer behavior from tariffs, but watching closely with merchants.

Q: Anthony Chukumba asked about lease merchandise write-offs, guidance EBITDA margin, and Wayfair originations growth.

A: Nancy Walsh said write-offs fluctuate within target range; margin improvement due to expense management and growth focus; Wayfair origination growth details not typically given but business outside Wayfair strong; Q: Scott Buck asked about merchant acquisition in uncertain macro, tax season seasonality, OpEx investment, and refinancing timing.

A: Derek Medlin said merchants look for growth avenues and Katapult's value resonates; Nancy Walsh said tax season seasonality consistent; SG&A increases in technology and marketing for growth; no new info on refinancing timing yet.