Green Dot Corporation (NYSE: GDOT) today reported financial results for the quarter ended June 30, 2023.
“I am pleased with the quarter’s results and the progress we're making against our 2023 operating goals, including launching a new major BaaS partner and adding a new partner to our financial services channel,” said George Gresham, Chief Executive Officer of Green Dot. "We are also nearing completion of our platform conversions, enabling us to shift our focus and resources toward enhanced customer and user experiences, business development and accelerated growth.”
Consolidated Results Summary | ||||||||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||
2023 | 2022 | % Change | 2023 | 2022 | % Change | |||||||||||||||||
(In thousands, except per share data and percentages) | ||||||||||||||||||||||
GAAP financial results | ||||||||||||||||||||||
Total operating revenues | $ | 365,876 | $ | 362,769 | 1 | % | $ | 782,256 | $ | 763,386 | 2 | % | ||||||||||
Net income | $ | 578 | $ | 15,008 | (96 | )% | $ | 36,590 | $ | 53,632 | (32 | )% | ||||||||||
Diluted earnings per common share | $ | 0.01 | $ | 0.27 | (96 | )% | $ | 0.70 | $ | 0.97 | (28 | )% | ||||||||||
Non-GAAP financial results1 | ||||||||||||||||||||||
Non-GAAP total operating revenues1 | $ | 361,144 | $ | 355,101 | 2 | % | $ | 773,507 | $ | 749,779 | 3 | % | ||||||||||
Adjusted EBITDA1 | $ | 38,869 | $ | 67,548 | (42 | )% | $ | 121,412 | $ | 157,874 | (23 | )% | ||||||||||
Adjusted EBITDA/Non-GAAP total operating revenues (adjusted EBITDA margin) | 10.8 | % | 19.0 | % | (8.2 | )% | 15.7 | % | 21.1 | % | (5.4 | )% | ||||||||||
Non-GAAP net income1 | $ | 19,154 | $ | 40,438 | (53 | )% | $ | 70,447 | $ | 99,015 | (29 | )% | ||||||||||
Non-GAAP diluted earnings per share1 | $ | 0.37 | $ | 0.74 | (50 | )% | $ | 1.35 | $ | 1.80 | (25 | )% | ||||||||||
1 | Reconciliations of total operating revenues to non-GAAP total operating revenues, net income to adjusted EBITDA, net income to non-GAAP net income, and diluted earnings per share to non-GAAP diluted earnings per share, respectively, are provided in the tables immediately following the unaudited consolidated financial statements. Additional information about the Company's non-GAAP financial measures can be found under the caption “About Non-GAAP Financial Measures” below. |
Key Metrics
The following table shows Green Dot's quarterly key business metrics for each of the last six calendar quarters on a consolidated basis and by each of its reportable segments. Please refer to Green Dot’s latest Annual Report on Form 10-K for a description of the key business metrics, as well as additional information regarding how Green Dot organizes its business by segment.
2023 | 2022 | |||||||||||||||||
Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | |||||||||||||
(In millions) | ||||||||||||||||||
Consolidated * | ||||||||||||||||||
Gross dollar volume | $ | 24,724 | $ | 23,289 | $ | 20,010 | $ | 18,682 | $ | 17,356 | $ | 17,436 | ||||||
Number of active accounts | 3.71 | 3.84 | 4.15 | 4.33 | 4.61 | 4.93 | ||||||||||||
Purchase volume | $ | 5,734 | $ | 6,145 | $ | 6,292 | $ | 6,443 | $ | 6,760 | $ | 7,192 | ||||||
Consumer Services | ||||||||||||||||||
Gross dollar volume | $ | 5,122 | $ | 5,677 | $ | 5,426 | $ | 5,495 | $ | 5,715 | $ | 6,621 | ||||||
Number of active accounts | 2.35 | 2.41 | 2.37 | 2.51 | 2.78 | 3.04 | ||||||||||||
Direct deposit active accounts | 0.59 | 0.60 | 0.63 | 0.66 | 0.67 | 0.69 | ||||||||||||
Purchase volume | $ | 3,984 | $ | 4,344 | $ | 4,229 | $ | 4,302 | $ | 4,588 | $ | 5,017 | ||||||
B2B Services | ||||||||||||||||||
Gross dollar volume | $ | 19,602 | $ | 17,612 | $ | 14,584 | $ | 13,187 | $ | 11,641 | $ | 10,815 | ||||||
Number of active accounts | 1.36 | 1.43 | 1.78 | 1.82 | 1.83 | 1.89 | ||||||||||||
Purchase volume | $ | 1,750 | $ | 1,801 | $ | 2,063 | $ | 2,141 | $ | 2,172 | $ | 2,175 | ||||||
Money Movement | ||||||||||||||||||
Number of cash transfers | 8.66 | 8.70 | 9.03 | 9.16 | 9.00 | 8.87 | ||||||||||||
Number of tax refunds processed | 3.87 | 9.91 | 0.20 | 0.28 | 4.48 | 9.61 | ||||||||||||
* | Represents the sum of Green Dot's Consumer Services and B2B (as defined herein) Services segments. |
Unencumbered cash at the holding company was approximately $71 million as of June 30, 2023.
"It was a solid quarter with results largely in line with our expectations. Solid operating performance coupled with a focus on cost control are intended to position us to absorb some incremental headwinds in the second half of the year. We are reaffirming our revenue guidance while narrowing the range for adjusted EBITDA and non-GAAP EPS, with the mid-point remaining intact with prior guidance," said Jess Unruh, CFO of Green Dot.
Updated 2023 Financial Guidance
Green Dot has provided its most recent financial outlook for 2023. Green Dot’s outlook is based on a number of assumptions that management believes are reasonable at the time of this earnings release. In particular, its outlook reflects several considerations, including but not limited to, the expected impact of the previously announced loss of certain partnerships and programs, negative trends within certain channels of its business, the current macro-economic environment including rising interest rates, the expected timing of expected cost savings from its platform conversion, and its investment in strategic initiatives. Information regarding potential risks that could cause the actual results to differ from these forward-looking statements is set forth below and in Green Dot's filings with the Securities and Exchange Commission.
Total Non-GAAP Operating Revenues2
- Green Dot is reaffirming its guidance range for full year non-GAAP total operating revenues2 to be between $1.376 billion and $1.462 billion, or approximately flat year-over-year at the mid-point.
Adjusted EBITDA2
- Green Dot is reaffirming the mid-point of its full year adjusted EBITDA2 range while narrowing the low and high end of its range to $182 million and $188 million, or down 23% year-over-year at the mid-point, versus its previous guidance range of $180 million and $190 million.
Non-GAAP EPS2
- Green Dot is reaffirming the mid-point of its full year non-GAAP EPS2 range while narrowing the low and high end of its range to $1.80 and $1.90, or down 29% year-over-year at the mid-point, versus its previous guidance range of $1.77 and $1.93.
The components of Green Dot's non-GAAP EPS2 guidance range are as follows:
Range | ||||||||
Low | High | |||||||
(In millions, except per share data) | ||||||||
Adjusted EBITDA | $ | 182.0 | $ | 188.0 | ||||
Depreciation and amortization* | (56.5 | ) | (56.5 | ) | ||||
Net interest expense | (2.0 | ) | (2.0 | ) | ||||
Non-GAAP pre-tax income | $ | 123.5 | $ | 129.5 | ||||
Tax impact** | (29.0 | ) | (30.4 | ) | ||||
Non-GAAP net income | $ | 94.5 | $ | 99.1 | ||||
Non-GAAP diluted weighted-average shares issued and outstanding | 52.4 | 52.4 | ||||||
Non-GAAP earnings per share | $ | 1.80 | $ | 1.90 | ||||
* | Excludes the impact of amortization of acquired intangible assets |
** | Assumes a non-GAAP effective tax rate of approximately 23.5% for full year. |
2 | For additional information, see reconciliations of forward-looking guidance for these non-GAAP financial measures to their respective, most directly comparable projected GAAP financial measures provided in the tables immediately following the reconciliation of Net Income |
