Bakkt Q2 2025 Earnings Report

Bakkt EPS Results

• Actual EPS: -$2.16
• Consensus EPS: -$0.69
• Beat/Miss: Missed by -$1.47
• One Year Ago EPS: N/A

Bakkt Revenue Results

• Actual Revenue: $577.88 million
• Expected Revenue: $17.10 million
• Beat/Miss: Beat by +$560.78 million
• YoY Revenue Growth: N/A

Bakkt Announcement Details

• Quarter: Q2 2025
• Date: 8/11/2025
• Time: After Market Closes
• Conference Call Date: Monday, August 11, 2025
• Conference Call Time: 5:00PM ET

Bakkt (NYSE:BKKT) is a digital asset platform that aims to bridge traditional finance and digital assets by offering institutional-grade custody, trading and settlement services. Established in 2018 by Intercontinental Exchange (ICE), the company initially made headlines with the launch of its physically settled Bitcoin futures contracts in 2019. Since then, Bakkt has expanded its product lineup to include spot trading of cryptocurrencies, a secure digital wallet for retail customers and a payment gateway that enables merchants to accept digital assets alongside fiat currencies.

The company’s core offering centers on its custody infrastructure, which is built to meet robust regulatory and security standards. Bakkt Custody provides segregation of client assets and carries insurance coverage against theft or loss, addressing a key concern for institutional investors and corporate treasuries. On the trading side, the Bakkt Digital Marketplace facilitates access to regulated spot markets and futures trading, designed to deliver liquidity and transparent price discovery.

Bakkt also operates a consumer-facing mobile application, which allows users to buy, sell and spend cryptocurrencies at participating merchants. The platform integrates with loyalty and rewards programs—most notably through a partnership with Starbucks—enabling users to convert digital assets into points or cash value that can be redeemed in everyday transactions. Beyond the U.S. market, Bakkt has signaled ambitions to expand into Asia and Europe, leveraging its ICE heritage to navigate regulatory frameworks in multiple jurisdictions.

Headquartered in Atlanta, Georgia, Bakkt is led by Chief Executive Officer Gavin Michael, who joined the company in March 2022 after serving in senior roles at Digital River and Dropbox. Under his direction, Bakkt continues to focus on product innovation and strategic partnerships aimed at increasing mainstream adoption of digital assets. The company’s governance includes a board with experience in financial technology, regulated exchanges and consumer payments, positioning it to capitalize on the evolving digital asset ecosystem.

Bakkt Q2 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Completed sale of Bakkt Trust to ICE and signed a definitive agreement to divest the loyalty business for $11 million plus relief of working capital, sharpening Bakkt’s focus as a pure play crypto infrastructure company.
• Positive Sentiment: Closed a $75 million SEC registered offering of common stock and warrants, significantly recapitalizing the balance sheet to support growth initiatives and a differentiated Bitcoin treasury strategy.
• Positive Sentiment: Signed a commercial agreement with DTR to integrate its stablecoin and AI payment infrastructure onto Bakkt’s regulated platform, laying the groundwork for institutional-grade stablecoin payments.
• Negative Sentiment: Reported a Q2 net loss of $30.2 million, a 15.1% year-over-year improvement, and ended the quarter with $61.5 million in cash, but crypto trading volumes fell 46.7% sequentially amid broader market headwinds.
• Positive Sentiment: Initiated a Bitcoin treasury strategy in Japan by acquiring a 30% stake in Marusho Hota (to be renamed bitcoin.jp), targeting regulatory advantages and planning expansion into additional markets.

Presentation

[Operator]

Greetings, and welcome to the Bakkt Second Quarter twenty twenty five Earnings Conference Call. At this time, all participants are in listen mode only. As a reminder, this conference call is being recorded. I'll now turn the call over to Cody Fletcher, Investor Relations, Vice President of Bact. Please go ahead.

[Cody Fletcher, Director at Orange Group]

Hello everyone and thank you for joining Zacks' second quarter twenty twenty five earnings call. Before we get started, I'd like to remind everyone that today's earnings call includes a separate supplemental presentation that can be found at our Investor Relations website at investors.bacc.com. During today's call, we will make certain forward looking statements, including statements regarding our signed commercial agreement with Distributed Technologies Research or DTR and the anticipated integration of DTR's stablecoin and AI payment infrastructure with Bakkt's regulated platform. We'll also discuss our strategic realignment into a pure play crypto infrastructure company, including the divestiture of our custody business to ICE, including expected timelines and the definitive agreement signed regarding the divestiture of our loyalty business, as well as expectations regarding the stablecoin payments market, regulatory environment and our product roadmap. These statements are based on management's current expectations and are subject to risks and uncertainties, which may cause actual results to differ materially from those expressed or implied in such forward looking statements.

[Cody Fletcher, Director at Orange Group]

For additional information regarding forward looking statements and risk factors, please refer to our filings with the Securities and Exchange Commission, including our quarterly report on Form 10 Q for the 2025. Further, in addition to discussing results that are calculated in accordance with generally accepted accounting principles, we will also make reference to certain non GAAP financial measures. For more detailed information on our non GAAP financial disclosures, please refer to our full earnings release, which can be found on our Investor Relations website. Thank you. And I'll now turn the call over to Andy. Andy?

[Andy Main, Co-CEO, President & Director at Bakkt]

Thank you, Cody, and hello, everyone. Thanks for joining Bakkt's second quarter twenty twenty five earnings call. It's great to connect with you all again. With me today is Akshay Nehesa, Co CEO and Karan Alexander, our Chief Financial Officer. To begin today, I'd like to zoom out to view the broader market.

[Andy Main, Co-CEO, President & Director at Bakkt]

As you can see, it's clear we're on the cusp of a generational shift of what money is, how it's used and how it's moved around the globe. Blockchain technology is beginning to transform traditional markets and over GBP 700,000,000,000,000 in global assets from equities and bonds to real estate are potential candidates for disruption. This is not a niche trend. We believe it's a rearchitecture of the financial system itself. Digital assets are emerging as a transformational asset class, combining value, computing and programmable functionality in ways that legacy systems cannot replicate.

[Andy Main, Co-CEO, President & Director at Bakkt]

Institutional adoption is accelerating with ETFs, tokenized securities and programmable payments bridging the gap between innovation and tradition. At Bakkt, we are positioning ourselves to be a core enabler of this monumental trend. Our stablecoin payment infrastructure built in partnership with DTR is designed to meet institutional grade standards, while unlocking entirely new use cases for cross border value transfer. With a leaner, more focused operating model and a team purpose built for this next phase, we believe BAT is well positioned to help lead the tokenization of real world assets as this market evolves. Since stepping into the CEO role last March, I focused on strategically realigning BAT to unlock its full potential.

[Andy Main, Co-CEO, President & Director at Bakkt]

We took decisive action to streamline our operations, reducing costs, exiting non core businesses and refocusing the company on crypto where we see the greatest opportunity for long term growth. A major step forward was forming our partnership with DTR, which gives us the infrastructure to compete in one of the most disruptive blockchain use cases, stablecoin payments. To drive this vision, I brought in Akshay Nachita, CEO of DTR, as co CEO of BAGG and a strengthened leadership team with deep expertise across crypto and fintech. Today, I'm excited to share with you that we have made significant progress since our last call that accelerates Bakkt's realignment into a pure play crypto infrastructure company. During the quarter, we completed the sale of BAT Trust Company to Intercontinental Exchange or ICE.

[Andy Main, Co-CEO, President & Director at Bakkt]

This was the first step in our strategic realignment as we saw significantly higher competition in the custody landscape following the repeal of SAB 121, which allowed larger institutions to enter the crypto custody space. On July 23, we entered into a definitive agreement to divest our loyalty business to Project Labrador Holco, LLC, a wholly owned subsidiary of Roman DVDR Technology Advisors Inc. When completed, this transaction will represent the completion of our strategic divestiture initiatives and marks a pivotal step that will accelerate our focus entirely on our core crypto offerings and forthcoming stablecoin payments infrastructure. The transaction includes monetary accommodations of 11,000,000 plus relief of estimated negative working capital and indebtedness to ensure a smooth transition. We expect the transaction to close in the third quarter subject to customary closing conditions.

[Andy Main, Co-CEO, President & Director at Bakkt]

Beginning in Q3, once the sale is finalized, we will report the loyalty business as a discontinued operation. With the divestiture of BAT Trust and the expected completion of the divestiture of our loyalty business, we are transitioning into a lean, efficient organization that's ready to execute at scale. Our newly streamlined organization ensures that we can move quickly to capitalize on market opportunities while maintaining cost discipline. The divestitures of Trust and Loyalty will reduce our cost structure and free up working capital that will reduce our cash burn and accelerate our path towards profitability. On July 31, we signed a commercial agreement with DTR, which paves the way for the completion of the integration of our systems with DTRs, enabling innovative stablecoin payment solutions for our customers.

[Andy Main, Co-CEO, President & Director at Bakkt]

We are already laying the groundwork for these innovative offerings, which Akshay will cover during his remarks. Further on July 30, we successfully closed a 75,000,000 SEC registered offering of common stock and warrants. This new funding significantly recapitalizes our balance sheet and supports our exciting growth initiatives, as well as the launch of a differentiated Bitcoin treasury strategy, which actually we'll cover in more detail shortly. We're now operating as a leaner, more agile organization focused squarely on the growing trend of digitalization of real world assets. It's still early innings, but I believe BAT is well positioned to lead in this next wave of innovation.

[Andy Main, Co-CEO, President & Director at Bakkt]

As a result of the tremendous progress we've made over the past year, the clear opportunities ahead of us as a pure play crypto company and the regulatory approval process for Actually substantially complete, I want to share the effect of the day I am handing the reins over to Actually, who will assume the sole CEO position to lead back forward. I'd like to take this opportunity to thank Akshay for his partnership over the last several months and to congratulate him on becoming Bakkt's next CEO. I will remain closely involved as an adviser, focusing on finalizing the loyalty divestiture and offering strategic guidance as Bakkt enters this exciting phase of growth. I'm confident that with Bakkt's strong regulatory moat and technology infrastructure, under Axie's leadership, Bakkt will transform into a leading platform in the crypto ecosystem for sustained growth. Thank you to our shareholders and partners for your support over the past year and being a part of Bakkt's evolution.

[Andy Main, Co-CEO, President & Director at Bakkt]

With that, I'll now turn the call over to Akshay.

[Akshay Naheta, Co-CEO & Director at Bakkt]

Thank you, Andy, for your leadership through Bakkt's strategic restructuring and positioning the company for long term success. I'm honored to build on this foundation to unlock the next phase of growth for Bakkt as a leading global crypto infrastructure platform. Starting on Slide five, I want to frame where Bakkt is headed over the coming quarters. As Andy just mentioned, we're still in the early innings of a massive market opportunity. To better position Bakkt to capitalize on this opportunity, we are building Bakkt to be a leaner and more agile company free of our legacy non core assets.

[Akshay Naheta, Co-CEO & Director at Bakkt]

Further, have successfully recapitalized our balance sheet with over €100,000,000 of financing to accelerate the three pillars of our growth strategy, which positions us at the center of this transformation in Money and Global Finance. First, our Brokerage in a Box solution, a turnkey platform that enables clients to achieve a rapid time to market to launch in The U. S. While operating under SOC two compliance and the necessary regulatory licenses. Over the second half of the year, we are preparing to roll out a comprehensive set of technology upgrades to our platform that will significantly enhance user experience, expand trading capabilities and create new monetization opportunities for Bakkt.

[Akshay Naheta, Co-CEO & Director at Bakkt]

Second, Stablecoin payments powered by our DTR partnership. This is where we are delivering programmable agentic solutions designed for cross border value transfers. Positioning Bakkt to compete in one of the most disruptive Block chain use cases in the market today is stablecoins. Heard our Bitcoin treasury strategy, which we initiated just last week through our investment in Marusho Hota to be renamed bitcoin.jp upon shareholder approval. We plan on taking this differentiated approach to other markets over the next few quarters that will leverage the technical know how to drive and manage an active treasury strategy, institutional custody solutions, yield generation and seek MNAV expansion for these companies.

[Akshay Naheta, Co-CEO & Director at Bakkt]

Together, these three pillars give us a clear and high conviction roadmap to capture on the biggest trends in tokenization, stablecoin adoption and Bitcoin adoption. We will now discuss each of these three pillars in more detail beginning on Slide six. Our brokerage in a box solution is already one of the most complete turnkey brokerage solutions available in The U. S. Today.

[Akshay Naheta, Co-CEO & Director at Bakkt]

We provide full license coverage across the country, integrated liquidity solutions and a regulated SOC two compliant technology stack, all designed to give clients rapid time to market with advanced brokerage and trading capabilities. This combination of compliance infrastructure and speed positions us as a trusted partner for institutions that don't want to build their own infrastructure from scratch. Additionally, we are leveling up our trading infrastructure in a big way. Over the 2025, we plan to begin rolling out Brokerage in a Box two point zero, a comprehensive technology upgrade to a platform that significantly expands our capabilities and revenue potential. These enhancements will increase the supported coins in our platform to over 200 from approximately 50 today.

[Akshay Naheta, Co-CEO & Director at Bakkt]

Upgrade our current trading engine, add social features such as copy trading, which lets users replicate the strategies of top traders on the platform, as well as yield generation capabilities. We are also introducing a redesigned user interface to improve the client experience and integrate support for tokenization use cases across broader assets aligned with the pending digital asset market clarity act of 2025. We believe these upgrades will significantly enhance our monetization opportunities while maintaining the same speed to market and compliance standards, which will make our platform extremely effective. As we roll out brokerage in a Box two point zero, our immediate strategic priorities are deepen current client and prospective client engagement, strengthen our growing sales pipeline and broaden our monetization opportunities. We are already seeing strong adoption.

[Akshay Naheta, Co-CEO & Director at Bakkt]

We've recently added Longbridge, Ascendex and Bitsy to our platform and are seeing increased demand from institutions around our capabilities to offer other value added crypto services while maintaining their existing brand relationships. Our platform is particularly compelling for international companies looking to immediately onshore into The U. S. Market. Our sales funnel also remains healthy with more than 400 leads at the top of the funnel and over 10 qualified leads moving to late stage discussions.

[Akshay Naheta, Co-CEO & Director at Bakkt]

This strong pipeline reflects the growing global demand for turnkey brokerage solutions. On the product side, we're focusing on delivering immediate enhancements that include institutional grade custody partnerships to meet the highest standards, a B2B controlled panel to give clients greater operational control and efficiency and margin lending products to expand trading capabilities and to create new revenue streams. These initiatives are designed to reinforce DAC's leadership and compliance scalable brokerage infrastructure, while positioning us to capture a larger share of the market as institutional adoption of digital assets accelerates. Our second pillar, stablecoin payments highlighted on Slide eight is becoming a reality through the upcoming launch of Packed Agent, our AI powered global transfers product and the first step in our vision to simplify and automate complex financial transactions for consumers. This product is designed to deliver efficient domestic and cross border payments, one of the most disruptive blockchain use cases in the market.

[Akshay Naheta, Co-CEO & Director at Bakkt]

As consumers are getting more habituated with AI agent, the backed agent is capable of transforming any message interface into a programmable money platform with just a few lines of code. This solution will deliver chat based transfers where users can send, receive and convert funds through natural interactions like voice commands, text messages or images, all through very familiar conversational interfaces that people already use. The conversational AI driven experience will simplify the complexity of managing finances, allowing users to simply tell the agent what to do, eventually moving beyond simple transfers to create a platform that truly differentiates us from neobanks of the past. Backed agent is fully interoperable with our brokerage platform via APIs enabling Agenci Global Payments and expanding our remittance infrastructure through the DTR integration. We have launched a private beta for early testers this month, enabling transfers to over 36 countries initially, with plans to expand to more than 90 countries within the next few quarters.

[Akshay Naheta, Co-CEO & Director at Bakkt]

Our focus is on the high remittance corridors in Asia and LatAm. By the end of Q3, we are planning to roll out the consumer offering to existing clients followed by a Q4 pilot with select businesses. Looking ahead, our roadmap is focused on developing a full featured financial AI agent that can autonomously manage and move money, a fundamental shift from traditional banking and not just an incremental improvement, but a new paradigm in how people interact with their money. This includes introducing clients to current and saving accounts, overnight interest bearing accounts and payment cards for both local and international spending. These features will extend Bakkt's role in the digital money ecosystem, offering clients and consumers a comprehensive suite of blockchain and AI enabled financial tools.

[Akshay Naheta, Co-CEO & Director at Bakkt]

This initiative not only positions us at the forefront of stablecoin adoption, but also builds a scalable capital light SaaS platform with multiple monetization channels in a market that's still in its very early innings. Finally, our third pillar, the Bitcoin treasury strategy, beginning on Slide 10. It is clear that leading companies adopting a Bitcoin treasury strategy at scale has created tremendous value for their shareholders. Our differentiated approach is to capitalize on markets with unique structural advantages. We are focused on large liquid markets beginning with Japan, where there are few publicly listed companies and institutionally credible vehicles such as ETFs offering direct Bitcoin exposure.

[Akshay Naheta, Co-CEO & Director at Bakkt]

This dynamic combined with a strong demand for digital assets has resulted in premium MNAS for public companies that are actively accumulating Bitcoin onto their balance sheet. The markets that we'll focus on present high barriers to entry in terms of regulatory licensing and market trust, creating a durable competitive moat. The markets also have more predictable supportive regulatory frameworks for digital assets as well as certain favorable tax related advantages for corporations holding Bitcoin. Furthermore, we plan on bringing retail brand recognition through the ownership of domains such as bitcoin.jp and bitcoin.kr positioning us to achieve strong market visibility, which we believe will strengthen our position with institutional and retail investors. We believe our expertise and our unique approach will enable us to operate at scale, leveraging institutional grade custody solutions, enhancing returns through yield generation capabilities and creating recurring revenue streams for BAC via treasury management and related services.

[Akshay Naheta, Co-CEO & Director at Bakkt]

Together, these elements position BAC to deliver sustainable value for our shareholders, and we plan on expanding this model into other strategic markets and geographies over time. And we've already begun executing, beginning with Japan. Japan's growing interest for crypto and clear regulatory framework for digital assets makes it an ideal jurisdiction to initiate our differentiated Bitcoin's treasury strategy. On August 7, we successfully closed the share purchase agreement to acquire approximately 30% of Marusho Hota Company Limited or MHD, a Tokyo listed company making back the company's largest shareholder. As part of the transaction, we have nominated Philip Lord, President of Bakkt International as CEO of MHC to oversee the integration of Bitcoin into the company's operating and financial model.

[Akshay Naheta, Co-CEO & Director at Bakkt]

Further, we plan on rebranding company's name to bitcoin.jp pending MHT shareholder approval. Bitcoin.jp will also be the title sponsor of the upcoming leading Web3 and Blockchain Conference in Asia, WebEx twenty twenty five in Tokyo at the August. We look forward to sharing more details on this at the next earnings call following the EGM of MHT, which is expected to be in the October. In closing, as a result of Bakkt strategic realignment, we believe that we will be a significantly more focused company, which is uniquely positioned to capitalize on the massive tailwind of the digitalization of assets. I want to end my remarks today on Slide 12 and summarize the key near term strategic priorities that we plan to execute over the next couple of quarters.

[Akshay Naheta, Co-CEO & Director at Bakkt]

One, finalize the sale of our loyalty business. This marks a pivotal milestone that will accelerate our focus entirely on our crypto offerings and stablecoin payments infrastructure. Two, as we move forward without our legacy non crypto businesses, we will finalize our comprehensive review process, fully rightsizing our cost structure aligned to our existing revenue base. This includes a bottom up evaluation of our organizational structure, third party service providers, internal workflows and technology optimization to drive synergies across our business. We plan to share details of this plan on our next earnings calls.

[Akshay Naheta, Co-CEO & Director at Bakkt]

Three, commence rollout of our Brokerage in a Box two point zero technology upgrades and new product roadmap to position Bakkt to capture efficiencies and significant monetization opportunities. Or launch our stablecoin payments platform, Backed Agent, that efficiently enables cross border payments and over time, reshape the way consumers manage and move money in their everyday lives. Lastly, expand our Bitcoin treasury strategy to other markets, having initiated it with Japan, where there's a clear regulatory and structured advantage for Bakkt as we started with MHT. We are looking forward to providing updates on this in our next earnings call. I want to thank our customers and shareholders for their continued support and patience as we are well on our way into a major strategic transformation.

[Akshay Naheta, Co-CEO & Director at Bakkt]

We are still in the early stages of a generational shift in what money is, how money moves and how markets operate and trade. I'm excited to lead back into this exciting global trend of digital assets as we unlock long term value for our shareholders through our differentiated position as a pure play crypto infrastructure company. I'll now turn it over to Karen to review the Q2 financial results in more detail. Karen?

[Karen Alexander, CFO at Bakkt]

Thank you, Akshay. I will now walk you through that second quarter KPIs and financial results. As a reminder, in accordance with GAAP, we present crypto services revenue and crypto costs and execution clearing and brokerage fees on a gross basis as we are a principal in the crypto services we provide our customers. By contrast, we are an agent in the loyalty redemption services we provide our loyalty customers. Therefore, loyalty revenue is presented on a one line net basis.

[Karen Alexander, CFO at Bakkt]

Starting with our crypto trading volumes, sequentially Q2 experienced a decline in crypto trading volumes, which aligned with broader market trends during the second quarter. The crypto market faced headwinds from March through June as investors adopted a cautious stance amid regulatory uncertainty and macroeconomic pressures that characterize the 2025. Crypto trading volume for the second quarter was also impacted by the previously announced restructuring of our relationship with Legal as we discussed on prior earnings calls. Despite these near term challenges, we remain optimistic about the strong tailwinds ahead. The regulatory environment has never been more supportive with the current administration and Congress demonstrating unprecedented bullishness towards digital assets.

[Karen Alexander, CFO at Bakkt]

Since the end of Q2 with Bitcoin hitting new all time highs in July, we experienced a significant improvement in our trading volume up 50% month over month. As Akshay mentioned, we've also onboarded three new institutional clients to our platform, Longbridge, Ascendex and Bitsy, who we expect will meaningfully contribute to our trading volume activity moving forward. We believe this favorable policy backdrop combined with our pure play crypto infrastructure positioning, full scale DTR integration and expanding partner pipeline position us well to capitalize on the next wave of institutional adoption and market growth. Now on Slide 15, I'll walk you through our Q2 KPIs, which provide insight into the underlying trends driving our business. In Q2, total active transacting accounts were 689,000 segmented into 265,000 loyalty redemption accounts and 424,000 crypto trading accounts.

[Karen Alexander, CFO at Bakkt]

This reflected the overall market as the heightened activity we saw in Q4 of last year dwindled over the next two quarters with uncertainty in the markets around legislation. The year over year comparison was relatively flat. Total notional volume for Q2 was $733,000,000 comprised of $565,000,000 from crypto trading and $168,000,000 from loyalty redemptions. Our crypto trading volumes underperformed market benchmarks on a sequential basis, but outpaced the market on a year over year comparison, demonstrating our resilience over longer timeframes. Loyalty redemption volumes declined year over year, but increased sequentially.

[Karen Alexander, CFO at Bakkt]

The year over year decline in volumes is driven by the exit of a loyalty client in 2024 in general softening in historical redemption levels. The sequential increase in volume reflects redemption promotions that occurred in the second quarter. Finally, assets under custody at our custodian partners for our brokerage business totaled $1,360,000,000 In the quarter, we completed the sale of our trust business to ICE. We continue to offer custody solutions for our clients through our partners BitGo in Coinbase custody. On Slide 16, we show our total revenue broken up between our crypto and loyalty products.

[Karen Alexander, CFO at Bakkt]

Total revenue for the 2025 was 5 and $77,900,000 up 13.3% year over year and down 46.2% sequentially. Gross crypto services revenue for the quarter was $568,100,000 up 14.3% year over year and down 46.7% sequentially. As noted earlier, the sequential decline in gross crypto services revenue reflects the market's moderation after a record breaking performance in the 2024, while year over year increase demonstrates improved market sentiments we have seen in crypto since the 2024. Crypto services revenue net of crypto costs and execution clearing and brokerage fees or ECB totaled $2,900,000 reflecting a 41.1 percent increase year over year and a 15.7% decrease sequentially. Net loyalty revenues were $9,800,000 down 23.3% year over year and up 6.8% sequentially.

[Karen Alexander, CFO at Bakkt]

Of this amount, loyalty transaction revenues contributed $5,800,000 while subscription and services revenues were $4,000,000 The year over year decline was primarily related to the exit of a loyalty client in 2024 as well as reduced volume based services revenue and transaction volume. The increase sequentially was due to higher transaction volumes driven by seasonal redemption promotions. Moving to Slide 17, total operating expenses for the quarter were $596,400,000 including $565,200,000 of crypto costs and ECB, which are correlated to crypto trading volumes. SG and A expenses were $3,600,000 down 34.9% year over year and 6.2% sequentially driven by reductions in insurance, marketing and promotion and occupancy costs. Total compensation expense was $20,100,000 down 10.1% year over year and up 12.9% sequentially.

[Karen Alexander, CFO at Bakkt]

The year over year decline reflects lower salaries, wages and benefits driven by our restructuring actions in 2024. The sequential increase in compensation expense is driven by our stock based compensation awards granted in lieu of cash bonuses and for new employees. Turning to Slide 18, we present our condensed profit and loss statement. Net loss for the quarter was $30,200,000 improving 15.1% year over year from a loss of $35,500,000 $15,400,000 was attributable to the non controlling interest in the operating company and $14,700,000 attributable to BAC Holdings resulting in a loss of $2.16 per share for both basic and diluted EPS. On Slide 19, we have our condensed balance sheet as of 06/30/2025.

[Karen Alexander, CFO at Bakkt]

We ended the quarter with $61,500,000 in cash, cash equivalents and restricted cash. The $20,500,000 sequential increase in our cash position in Q2 was primarily driven by the $23,700,000 of net proceeds from our convertible debt offering in June, dollars 4,500,000.0 of proceeds from the sale of Act Trust in May and a $1,900,000 reduction in restricted cash collateral requirements, partially offset by the repayment of $5,200,000 of principal and accrued interest on the ICE line of credit and other operating cash utilization. At the July, coinciding with our successful $75,000,000 capital raise, of which we received approximately $68,800,000 after deducting the underwriting discounts and commissions. We terminated the ice line of credit agreement given the pending sale of loyalty and our strengthened liquidity position. On Slide 20, we have our adjusted EBITDA for the 2025.

[Karen Alexander, CFO at Bakkt]

Adjusted EBITDA reflects adjustments for certain non cash and restructuring and transaction related items that impacted the period. Adjusted EBITDA for Q2 twenty twenty five was a loss of $12,600,000 The year over year improvement in adjusted EBITDA loss, which narrowed by 29.9%, was primarily due to the overall decrease in compensation and benefits and SG and A expenses, partially offset by an increase in professional fees. Thank you, everyone. That concludes the prepared remarks session of our second quarter twenty twenty five earnings call. I will now pass it back to Cody for closing.

[Cody Fletcher, Director at Orange Group]

Thank you, Karen, Andy, Akshay and everyone for attending our earnings call. We look forward to connecting with you again soon.

[Operator]

That concludes the conference call. Thank you for your participation. Enjoy the rest of your day.

Participants

Executives

• Andy Main, Co-CEO, President & Director
• Akshay Naheta, Co-CEO & Director
• Karen Alexander, CFO

Analysts

• Cody Fletcher, Director at Orange Group