ALKT - Earnings call transcript Q4 2024

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good afternoon, ladies and gentlemen, and welcome to the Alkami Technology Fourth Quarter 2024 Financial Results Conference Call. [Operator Instructions] This call is being recorded on Thursday, February 27, 2025. I'd like to turn the conference over to Steve Calk. Vice President of Investor Relations. Steve, please go ahead.

Steve Calk

Alan. you Thank today's and on Alex Chief Shootman, With Hill, call Chief Officer; Bryan Financial Executive me are Officer.

are future During today's and These views our guidance uncertainties. and risks are statements forward-looking management's subject statements and performance. to expectations call, we other may matters make based current on and various about regarding

Our actual different. materially results may be

the the to forward-looking financial call undertake Statements to today's refer For of a please measures the in our believe XX-K. as filings made risk our measures understanding discussed summary being non-GAAP revise otherwise no latest release of with found are will factors statements. section are in of comparable statements, a made we can stated, our results. associated SEC. be unless in Also, on basis. during update these reconciliation A with in GAAP our the and on these in financial press today, We and or our the financial of this useful call earnings be measures to release press investors obligation

turn to the over Alex. call I'll Now

Alex Shootman

and full Good joining for Thank of which results us. an another great thank to afternoon, you quarter financial all you, Alkami, to contributed I'm year Steve. performance. pleased outstanding for report

grew quarter fourth EBITDA. of XX% the adjusted During over XXXX, revenue million generated in Alkami $XX and

up In is users million X.X prior addition, we platform, ended the to quarter with compared XX Alkami and million users that year. on the the

cash growth by we revenue points XXXX, year of adjusted operating the For XXX of million. over expansion flow delivered basis EBITDA XX%, full and improved $XX margin of

beginning XXXX. profit revenue provided to these track are I execution multiyear of our the and Bryan of continues proud We at targets and results as the

quarter and and desired a to earnings business our on XXXX drive plan the I'll the fourth our call, Mantel. acquire like to discuss few In outlined we X-point comments our I'd a year, make plans to long-term then quarter outcomes.

fourth, second, we in we and for to sales efficiency we these would equation. would results Alkami's become in drive fifth, market; and business differentiation; credit of acquisitions on progress objectives. bank leverage of we company business market platform destination growth; talent; are a the succeed union would would an excellent would our we X our as part third, add-on be outcome growth the current had First, in for invest

the XX At the we in in end XXXX, union of in We remain the 'XX we in Alkami market. to And contract, platform XX end we the backlog. compares of credit digital provider union investing our banking on the focused This became in XXXX, users. live of under had on credit mobile the XXXX. were bank the terms including banks #X banks our on market market at X platform as in

in new Alkami wins the doubled As participation half XXXX. of is market our union XX% the to half XXXX, add-on of generate goal reminder, our to new logo compared sales of a bank XX% represented XXXX, new sales bookings. have credit the almost Alkami's to In add-on Since bookings and at in market. longer-term we

key of platform's within part versus capabilities. enabled migrated period We that count revenue by the the our improved XX a XXXX. and Kubernetes they since XX% auto-scaling track scalability. of XX% XXXX, with in has per Alkami over XX client Our Within XXXX end have renewal over microservice increasing quality, than been more sales and -- in our team resiliency Alkami annual investments our to have or platform, of tripled and user

XXXX, believe availability for and XX.XX% the provider includes to we increased we has that are calculations. only our maintenance windows availability Our in

improved platform X been efficiency high and of watermark since -- Hosting of XX% have almost by of gross points the over efficiency improvement cost per basis and XXXX. have years in cost implementations. implementation hosting an from XXX the Our improved investments quarterly last user margin improved has prime our drivers

On front, retention XX% rate increased since XXXX. XX% to we've our the talent

engagement best places me to we in employee team final scores to leads product and and through best is work And that to fintech. best in into best engineering the HR grow team, team, XX% culture, favorable. best team, Our team, won XXXX, are the of Alkami. which the strategy discussed sales best awards include best This objective business acquisitions model Alkami leadership fit business

rest to it Mantle's team that solves We our built MANTL to people, a with front a and to the consumer door have both a onboarding the to done accounts for great wide in really Ben importantly, Nathaniel, products most And originations the for add a market. hard a solution which and they've financial and is excited are business clients critical of for Alkami. and SaaS culture company premier and the and opening of institutions. offers as variety deposit serves commitment great the problem, MANTL customer. account

we've from existing increasing and clients the the the for new heard broader need customers. improve years, about market Over accounts to they way open and strategic the of products add our last for couple customers

and from a the have for greatest their client across of digital account The executive fielded customer in transfer XXXX, top their become dynamics financial upcoming credit among opening option choices, in experience possible mega considered create account we October to under meet creation Out member in These that are I is respondents which Alkami the union to better banks. what improved of asked these fintechs a investment will invested critical When the offering. priority This of in example, expects improve #X institutions to XX need technology experience, For credit with community the platform. improve topped banks was rank be in an digital onboarding community competitive prioritizing or wealth study regional history, and channels. investment who unions opening institutions financial predictions experience elegant was among has an #X are XXXX. and priority every an technology. heavily including all banks and world intense pressure

or Alkami bank as data in accounts, branch, in onboarding all agnostic unique base and virtually the $XX automates opening, contract, union financial transaction penetration both and the a this consumers industry. XXX for in clients to call is to multi-team of After XXX service account institutions digital sales relationship are to cross-sell platform great or premier center that for enables over its the technology bank minimal have between in deposit billion million businesses, and will onboarding it in creates MANTL and institutions process addresses assets. they Alkami under Mantel's digital, that are solidifies onboarding closes, is support MANTL in and of engage accounting. base required including MANTL X needs a position including a platform it offers managers. secured digital both Alkami's in onboard, Alkami from MANTL. opportunity With XX% financial banking, and channels proven client the grow acquisition, and and banks. overlap It as the technologies for X in all the single MANTL their market-leading and technologies approximately and the ranging environment. account size have credit $XX a Of These these, production, analytics. deposit and

growth offering For types than converting funding boost all works all majority alternatives. onboarding, already with for opening solution deposit a will across initial single application, channels and has products. that customer proven the competitive of MANTL higher onboarding to less and create This higher for account a deposit fraud

it and institutions digital was among and banking digital environment. For all best Alkami's million XXXX. with app financial platform in multi-tenant banking banking engagement, a is U.S. TearSheet base XX a users It serves code solution awarded by the single fastest-growing over

integrated an Alkami's on when XX descriptive land-and-expand built churn. Alkami ultimate will improves core tags service are cross-selling analyzing increase credit clients these sales for value, to growth, market. more more competitive Alkami their revenue predictive a and digital and solutions than for and become advantage create billion platform and But For transactions in unions. provides solution and and which trained marketing Alkami's will data manner, dozen targeting the reduce the used institutions a solution banks models enabling AI client have data personalized is in and financial to XX,XXX

Let me examples. give you X

institution expansion. account data business deposit holder a of a deposit onboard Alkami account on driving in and account and minutes with new holder new Banking. Using features guide retail history business financial transactions, a promote the retail to business a account First, Alkami the using functionality and could to marketing, and MANTL, Digital

registered, with not Digital our addition or per accounts either by by who Alkami the create which opening digital accounts use a through Alkami's Alkami campaigns experience effect to new opening will believe account abandoned functionalities improving digital customer advantage. Digital -- Banking service client to We conversion. account target MANTL account Complementing in platform. Alkami's unlocks and onboarding Alkami and competitive experience opening platform run sales this and clients. for marketing of an or benefit both Digital guide data acquisition digital account Next, Alkami our for encourage drive marketing system number Bank by an into banking customers TAM features portions Banking, digital our to of financial and onboarding flywheel that the and MANTL, And and data A the and increasing users, conversion of wins. the will for in industry-leading banking household, registration could digital new auto users, our a and and identify and customers marketing targeted opening institution members on have leveraging growth increasing is and finally, increasing in have

I'm the the in cross-selling growing of and our be to employees, #X into close I'm about In for into Thank demonstrated to acquisitions. these place XXXX. take We market have in addition, platform. excited of intent on sales MANTL execute you our segment client Alkami your an we're to momentum capabilities continue XXXX. the and trust hands results and ACH relationships the we our investors MANTL will say who our to Alkami continuing team In banking to yes from for we proud closing, suite success eager products to take And from client product alert our our digital with clients I'm excited and to new Alkami. transaction personally to commitments. the

call I'll now hand the Bryan. to

W. Hill

Thanks, revenue on outperform good to profitability XXXX, drive In Alex, growth and continue everyone. industry-leading and our we goals. afternoon,

adjusted a year, EBITDA XX% compared we $XX.X improved of representing to of million the achieved in XXXX. to For growth million, $X.X loss and revenue million $XXX.X of year-over-year total

total revenue in XX% and XXXX XX.X% almost Subscription revenue. grew represented of

entering results the are year, were finish a momentum. to and quarter fourth Our we XXXX with good strong

of XX are next by XX%. quarter currently fourth $XXX have the last over our in months XX% Included We occur achieved quarter increased banking the of clients users. exited exited backlog We approximately will clients digital representing revenue. approximately compared million of in revenue ARR revenue XX% growth new users representing Subscription at total and the We X.X on million, XX% $XX.X backlog ARR million. million For XXX and which grew growth XX of representing million implementation, $XX.X platform registered of of majority the to of our user XX for XXXX, the XX% digital and we represented quarter registered year. $X.X or million with

Over XX we institutions the digital implemented supporting financial XX X.X last months, million users.

adoption their X.X In users. user digital addition, our existing clients increased million by

a reminder, to client we of our X because As of long-term the visibility quarters into X of nature upcoming have contracts, attrition.

X% of our churned ARR. digital we XXXX, less than banking During

to digital onboard banking expect long churn do at XXXX, per Currently, ARR. representing average an expect to clients of clients we users and year RPU less better X% success addition the higher in to XXXX. in churn modeled ago $XX.XX, and who by to a X% quarter the X of up X% a RPU. of term, much than but the with We we new year, compared Over XXX,XXX sales to ARR add-on X% with tend ended driven

RPU greater New clients our reflecting implemented the adoption to compared product an for quarter example, when For with banking installed fourth base. digital $XX.XX, of

seeing broad-based demand are We our product portfolio. across

represented sales. new XX% platform new year, the our we including of XX signed banking For add-on clients, approximately XX effort digital XXXX sales banks and

to ARR below a our functionality outperforming industry cohorts renewal, total, XXXX. expect XX year In finally, renewed sales the XX the just as for compared renewal add-on their again competition. In We wins, XX% our renewals relationships XX to contract we XXXX, into increased are competitive in keeping XXXX financial was of institutions approximately year responsible sales, In wins new under XXXX. And this our our XX with client our logo Added slightly rate is time average up cohort client at together prior XX% XX And in remaining forward several ago. with ARR client billion, X.Xx competitive year we and performance their compared addition team $X.X to run once renewals, obligation representing represents as recent renewals. pull XXXX. for

Now to gross turning margin.

XX.X% expansion For the well year. operations. costs of the nearly achieved delivered expansion as gross representing XXXX, our continued compared leverage basis we investments non-GAAP fourth prior our to hosting gross XXX and in margin of through operating quarter We across as margin points post-sale of improvement platform

margin As XX%. objective a XXXX is reminder, our gross

Moving to operating expenses.

For of $XX.X represented each but G&A, where operating to XXXX, non-GAAP leverage revenue continue basis of year-over-year in scale. million We we expenses XX% the operational of operating operating primarily points. fourth XXX quarter leverage category, across derived or approximately operating expense of realize

high to level go-to-market achieve continue we sales efficiency. addition, a In and of productivity team

X.X:X. sales of increased and We best marketing in of ARR this months, representing XX while we SaaS ranks efficiency. the in efficiency among sales in and last alchemy our believe an $XX.X $XX.X million ratio the marketing, non-GAAP investing For terms million

EBITDA of the million, expectations. the quarter in better end adjusted high Our $XX.X was fourth our than

margin adjusted and XX.X%, XX. EBITDA the growth revenue in quarter Our when for Rule with of was achieving rate, results combined our

have captive We offshore invest to in started our capability.

expect we in quarter, investment approximately million XXXX. last of an discussed we As $X

to positive vendor current transition see XXXX planning impact impact XXXX, beyond do and during a to our margins complete any from targets, still on anticipate we we do are expect We XXXX. financial the on although not our

of from extends We've we quarter also million, sheet. XXXX. and an facility, just million cash our to $XXX $XX.X ended amendment our Related million February of million date operating and revolver improvement We credit which to to of In announced securities. marketable million just $XXX our maturity expands to under $XX.X cash $XXX compared the of balance an flow the with to XXXX, produced XXXX.

us to This provide attractive commentary to our ACH a acquisition. in and success among into institutions relationships. be let MANTL clear Before turning banking and current our engage is as MANTL customer transaction on similar acquisitions client Alert powerful us additional unlike a differentiate platform that no digital digital to banking help will very their grow drive platform contribute help some financial the our position and products base. will digital success further our guidance, believe a in to wins There leader me providers, will banking onboard, segment, digital with banking we installed of cross-selling

employees a plan for to agreed price release, approximately $XXX be an As subject of $XXX an million. to unvested issue and we've funded closing cash-free replacement or to units to discussed MANTL customary in The stock $XX restricted cash. today's is resulting stock press debt-free to enterprise and price basis to be adjustments, million options. estimated value of expected transaction acquire on million We MANTL purchase at which purchase of compensatory expect value with with we $X million

price. We have multiple million the cash options $XXX purchase to fund

or debt balance equity, equity-linked be liquidity can include for options shelf Our financing. a capacity revolver universal that sheet used and and

approach subject We are less of of The represents quarter we occur the the to projected provisions, acquisition to Xx second about to before Closing synergies considering HSR an beginning the start ARR at than including expected before price and the is approval. end We during believe evaluating IRR XXXX. contract under as of is purchase revenue has these closing. XX% customary XXXX. expected options

guidance. to turning Now

to are we growth XXXX, quarter million, XX%. the total providing $XX.X represents revenue the For of of in $XX first guidance of XX% range revenue million to for which

million. million we to EBITDA, first guidance the $X.X range in adjusted providing quarter of For are $XX.X

$XXX year full revenue the for million, revenue representing million to XXXX, $XXX of total XX%. we guidance of to XX% providing in growth For are range

million guidance of million. $XX also to $XX just are providing EBITDA We adjusted

of an acquisition believe year business of from XXXX. March close starting We adjusted guidance million $XX the contribution million to includes full EBITDA $X XX, an date Assuming approximately of revenue the and adjusted be in accretive will loss MANTL EBITDA acquisition. MANTL

million, to of when metric approximately above at representing the to XXXX. We be same expect XX, XXXX, December contract the MANTL's ARR $XX growth rate a at compared under end XX%

very In with financial performance. pleased closing, I'm XXXX our

go-to-market best-in-class leverage delivered operating growth, superior team and efficiency. continued Our

companies. industry perform enjoys we to that category ahead. and tailwinds strong of among solution the best leader leading an believe unequivocal MANTL opening innovation years already continue many now with in an omnichannel account the We SaaS And in

With the call that, to I'll questions. your to hand operator the take

Operator

question Instructions] Schmidt comes Andrew first from Your [Operator Citi. of

Unknown Analyst

of give This Schmidt. is cross-sell David with impact Wielansky more the on potential Andrew for MANTL your I opening How you if there. compare on existing could account does And wondering opportunity was the solutions? details

Alex Shootman

X you more to XX And interest might rates. rates. XX has We that institutions. to loans financial what ability the Thank all you critical trust accounts, a become X into rates consider and the be as our that accounts, just be normal, whether do, opening we guardian listen as more accounts, would an for say, then product. got were really I of were were And normalization would trying what And types. none of that is to have of only offering they to of call banking opening have would roles, even manager, or customers call of operate beneficiary, for that savings current in question. lot offering account it specialty escrow account to to to and we in operate interest make to branch. able we lots now little to X what things in current digital solution support with because interest the went types deposit account bit The could our market, account have types think can different relationship more with you well of of as of years and structures deposits how if digital, a through And custodian, whole ability that and almost the commercial centers, those about are accounts, different about products they needed retirement needed a attract a I

our did it meet not So market product -- things few of in but product a all the few did summary, and current did MANTL what well, the of does. the that's a things, needs

W. Hill

providing and have our more consistent XXXX. longer-term of We with guidance. been very

user growth. organic growth user So

a acquisition, XXXX. MANTL be is haven't we with would expansion determined X% which yet growth range, the consistent excluding that XX% XXXX. user very to So range, with move guidance in very incremental close in the we the consistent will ARPU expect that What base, to will again, combined XX% into and yet, before we come more consideration a we with once once users MANTL acquisition of is go-forward client and the client the the providing we -- MANTL will base basis MANTL RPU. on X%

And so today let clients those $X couple and RPU and contract has me give of carry average XXX MANTL under you an a examples. clients between $X.

but nice as little the digital Alex to very Alkami. about to And client So in there's going commented bring it's a on prepared add, users they're comments overlap his X between bases. X million

in The base base complementary client and MANTL unions. client XX% XX% XX% Alkami at XX% very So banks banks moment. the credit they're The nature. is is unions and credit

nice but another, each to very complementary overlap. to one with little not So

So find is but to at million, jump million, $XX to $X $X will count user you're what adding you'll RPU. $XX ultimately our a those users

Operator

comes Barclays. of Kalia next from Your Saket question

Unknown Analyst

that a you Ryan for up tonight. your you expect interesting. of this X Or deal. running MANTL where is might buyers more start to acquisition? just similar other be of that with the to Certainly, the you environment curious space the of it's there be This to corporate in the against? type might competitors go banking head-to-head competitive market? digital core what Saket lot Maybe on Pagolia would on in Is it terms see I'm

Alex Shootman

there's in from our pursue very capability really X capability they've is customers we this core One with deliver or a outdated alternatives talk members. of -- trying when their to provider. to a got their they There's clients, that type really

tried market to process thought with core they is, experience. and there we to of the the over second what some across stitch players are the core integrate systems. is a this some the is that also the The agnostic, software look their built What that way fact and them with that And try allows their smaller that together experience to MANTL they at. are technology own of they're write MANTL they've of user in XX product, about them is liked that different about many customer experience and very the that the design well to end-to-end

MANTL the So with and in medium the a opening with experience XX% business and X account minutes automated median a within in X is in minutes XX MANTL compared minutes received compared retail the opening industry an account is of decision. hours industry applications experience X.X

There but customers tried looking Yes, when got yes. to about some superior is on MANTL So small far some market. own, to that that other excited was players. delivers is that's outcomes there's are technology. we their that there's at we legacy have write what core anything were else Yes, MANTL the the technology the

Unknown Analyst

That's a you. helpful. for Bryan, super maybe Right. follow-up

while 'XX. EBITDA I for loss think fiscal EBITDA you release, that an the be in expect press accretive you in there's mentioned this to it year, mental

just Just all? cross-sell is sort purely revenue of sort and synergies wondering, this that are by deal thing? Or of any that from you driven including synergies expense at

W. Hill

So in those of we're in relates really occur XXXX. to and the revenue half synergies, as more be to back it or primarily evident XXXX expecting

client one another. in complementary As David are the I from to City, question mentioned bases the very previous

nice So there a synergy. be revenue for opportunity going is to

we're As MANTL in such leverage able G&A as we'll XXXX scaling they'll the developing within At it relates the to operation, global in MANTL to capability some expense -- center to be Alkami. able that be India. synergies, point, leverage things the

they're fast-growing experiencing. it's to go-to-market identify growth. a day even synergies from the drive helping here is perspective is currently mantle a to We having keep X. efficiently not want revenue We're do anything cost-cutting about and do So on Because growth trajectory mind, more business. in than more it further upset that scale to synergies MANTL

Operator

Walravens Patrick Citibank. of from comes question next Your

Patrick Walravens

process did this the Congratulations. to the get deal, hear Great. unfold? how we And I how meet first love did of do the transaction? when to to would sort Alex, background you them

Alex Shootman

of each have since about Well, known this the X companies XXXX.

future And options running Pat, deposits of several areas. were outside said, several and Colorado. fraud would they've the to there's known a us. we -- and could different need people We've But company the we in location we've know came and Customer attract a we our or we listening bigger cross-sell than investment quite and running I people were that deal their is invest understanding as we've platform get company understanding that them in other's and issue culture, company. that relationship us So We've this other stayed great we And data each reviewing through quality while. continued they products to something the of of evolved like their characterize are known end-to-end different for the we've these detection, we underwriting a that And systems. guide Denver, onboarding customer end, with what to customers customers. members. our help platforms, advisory meet long-term in at our and of year, got that legacy back board things but and other them last can very We to And functions, Board us then in both the also Alchemy Advisory we and treat about that's together so also customer had our not all need kind features us for they really June a members our strategically. that. got and our huddled experience at members

us deliver is to So we to you great Alkami, experience. that what end-to-end need do really

management each I of other, wanting time. long space. market known do respected their for we've was a for speaking said, then to to time. The this need know something getting to time getting we've in to We've each as And a Pat, just each So know spent other other us a lot really team. long

is things cherish within we One did all our customers we investigation treat with the MANTL. to the that really that the our ability for and as evident was the Star of culture North

more this sure characterize we as probably known want to was many market do. right was other got than in I time. to know, and We period there of long a the strategic a need a to this the we've each months thing So to but each for for make other knew know you that would

W. Hill

creates network flywheel I we it's the when in powerful. mean, And all is that a to front end of a effect revenue those view comments just to believe back a elegant then a branch. mean, with experience the twins described. experience. Pat, we it banking marketing most space no digital platform view best in provider asset offering relates it absolute as that of relates offerings strategically, or the solution. I with end what accolades to the that onboarding deliver finally, to more digital mean, taking as And that add to front-to-back the space, in just then we of I banking very couple data that I I'll as And disruptive, this. the the delivers There is effect, And other digital that analytics pairing similar combining best can as technology platform. digital what that the the

Mantle for would strategic raising of watching a we've to And long always Alkami for so acquisition And reasons at MANTL, And could do this when decision home an that or been a felt the it's partner. Alex point be where time was And to. come just is described, that a was to the finding MANTL capital at an a they right time. finding best the that potentially they all alternative really type.

next staying it which we Alkami a really we're what the are here years. them the X excited X about, late years after announced and talking we And future company $X to very and over and today, the all beginnings of them, saying of extremely to is of to are building early so close XXXX. revenue manifested And billion

Operator

next Blair. of Your from comes question Cris William Kennedy

Cristopher Kennedy

the details. of all for Thanks

little a within banks business has focus and to activities. kind banking wanted Just mantles a seems presence really bit. It doing good of like

kind Just of how dynamic into acquisition? played talk about that the

Alex Shootman

It played of in ways. couple different a

on and consumer sole trust the and business onboarding opening account types, nonprofits, proprietorship, partnerships, able market that focused and general to platform of and we're whether pair serves bank both states. to it's know, you right, As being business all sorts

direction, is strategic XX% unions been was us capability the interesting the we've Alkami's credit bank I But that a really have that's thing to long-term with strategy. where meet interesting in in the other of So really probably of been commercial market. investing terms that

us good this got they've bring just to well. being got MANTL so as credit Alkami into union fits And also because consumer a business good but for product they've able installed not into base the a product, because

One, I really X XX accounts. our of two, cross-sell investing both market. And in kind consumer attractive the of of about Bryan it credit has think said, as happening there's that base, think companies market, future. virtually no than less it's the in both was bank But really those for transformation the some overlap as the from things. the of coverage there's So and the between strategy potential customer number a business the we that's because for MANTL of in matches union

Cristopher Kennedy

another was a I from the question positive. know guess, Great. then, And go just you asked the earlier, I one that negative quick to EBITDA on again? but a double-click just prospects on for MANTL. Can to

W. Hill

revenue that's primarily with exiting revenue of that's of north growing under XX%. scale and Cris, mean XXXX by million MANTL Yes, driven $XX just contract,

profitability, Alkami's on growth relying larger business So to Alkami, And trajectory. becoming very for Alkami's areas business. it's and Alkami, that's go-to-market, they're future R&D, -- G&A, still MANTL. relatively a Alkami's those with drive fast leaning a small a scale

it together or to rather business So on for working areas Alkami it's MANTL those in -- scale. within to lean able being being really help able the companies its X Alkami

Alex Shootman

mean, of an Alkami's I've And will analysts things strategic and have of be also we asked one many model. into acquisition, quarters, us the many will acquisitions. Bryan for I with business it met we about do the said when I it fit both that the and that

like do thing the that growth is about And company. MANTL. a we MANTL so

not lot of Bryan earlier, them want we to So things situation situation some to that said a out into this where a where, company can it cut model. is as leverage within well-run some expense is a Alkami. figure This they're a

in we this business. So that, accretive to XXXX, as our see mentioned, as Bryan

W. Hill

of think you points over being look Cris, organic about out about should -- as Yes. But of think couple a MANTL multiyear you incremental growth. period, a

to to be then points X years MANTL margin beyond next and drag reaching conforming You on now and accretive margin should think for X EBITDA Alkami a about the that. an gross EBITDA and X to to profile being X of margin, will

Operator

comes Sachs. of Goldman question from next Our Adam Hotchkiss

Adam Hotchkiss

you're want into bank just and little To able degree over around what do traction base. industries, existing you were the less I couple think have When that MANTL. up success are next see be may due last there know contracts might on question you bit you to to going cross-sell the follow what that the a these to to Alkami visibility MANTL's customers. platform be evaluating or I you longer into that? comfort of a But than bit that. do some accelerated incremental years other MANTL's little

W. Hill

I by to existing to segment what that represents million base, is the that client-based between financial client a similar significant MANTL billion, $XX also and Alkami. $XXX percentage similar And MANTL is mean with Alkami. The and very institutions assets it's of

for $XXX financial to sweet million found where the penetration $XX size the billion assets of have we institutions. Our spot greatest in been has

to MANTL into would the So that the ability solution digital base the we MANTL there's reason not offering no the or have banking to the installed to sell expect and base. Alkami platform into Alkami cross-sell

segmentation feel So the had have We we and same market. very the it's area think in success complementary. both that significant of companies

Adam Hotchkiss

That's And renewal forward then on pull just the clear. Okay. you really mentioned.

would that pull year growth cross-seller renewals how after a if typically curious see perspective. you a a your opportunities Just into forward from impacted expansion and be of impacts XXXX

W. Hill

for We're having success or cross-selling time a whether not. renewal it's

strong a and went has renewal. really point momentum X it's team later client our live at of sales signing years or client to contract, the So client the if the has just after cross-sell X X, whether to a ability it's gain year begun pretty into

client contract expect sales our that would in to team sold. contribute we to XX% total to plus continue value than So

Operator

Your of next question Smith comes from Alex JPMorgan.

Unknown Analyst

So first, was to I margin profit on hoping line. the start gross

profit trajectory that the at pretty You've I gross for longer-term since XXXX. be stable XXXX. profit in had think you margin your gross MANTL should margin And profit us gross you accretive remind thinking least margin line? expansion mentioned about margin Can

W. Hill

Yes.

points. provided margin. We're at XXXX, longer-term that will X XX%. at We'll bit . a of MANTL of basis Alkami exit XXX We that. So guide to guidance the should about you is gross what a core at we've be run And expect rate years be ahead by a gave accretive business XXXX ago.

Unknown Analyst

calls EBITDA helpful. other very the through for roughly? as deficit first the MANTL And would year, That's those costs items us and that we think OpEx line you how the allocate

W. Hill

let's Well, the just EBITDA loss. talk about

sales $X EBITDA and $X gross in quarter. around gross they're how pretty in quarter, MANTL OpEx the $X million in marketing to heavier about little think closely categories The aligns. million contribution of From achieve third a third and a should align is, fourth fourth Alkami Alkami -- the a category, margin the by XX% around on you million from able million has quarter the the OpEx a of from So second, bit been loss they occurring perspective, over a of than second $X but to quarters margin. and XXXX,

Operator

Jeff Capital Hallum Your Van question Rhee comes of next from Group. Craig

Unknown Analyst

Jeff. Daniel is This on for

cross-sell in will account that have, customers in needs maybe that will -- some if some them offering of Alkami motion, that the place. such the the If look. opening the correctly, on have of Just doesn't I'm a how cover other understanding currently, lot offering the

does base coming displacing what what of that Alkami And be you'd . MANTL to most that with sort you're for part? as now so cross-sell? Just right be the would in the have

Alex Shootman

Yes.

our product the will have to that given customer of base, the and technologies customer will to in have have that trying As I our have majority today, of we said They earlier, they're this. customers range might penetration they base this of Alkami's our tried be the to of product the product -- use cases, a a given together following scenario process. be product. in They'll their use And stitch using as core. to another off something opposed product. lot an to third-party their have -- some write either will own to accomplish of but software legacy They'll trying Alkami

the example. unique and is really they've mantle how as that streamlined KYC, about the embedded are Some process an things automated of

And very it's a experience, from just and itself a user how so today. deliver able this it to customer manifests sees when process a different experience they're and

mantle covers customers our would a any a credit we'll not we our There's cross-sell. I the sales have really product will bring union to client that for bank perspective. that cross-sell after team the customer be our product all from that anticipate not bringing existing of and that we So customers customers be closure, our the of or to would potential MANTL existing

Unknown Analyst

Okay. the impact part the That's I helpful. people And then QX sort of in on just believe of a of they the on just they're like as side side, with MANTL on work marketplace. the other marketplace, lot the flip

all getting impacted Is contemplated there guys? by have churn after acquired relationships those how Just be you there? inherent any

Alex Shootman

We would they goal. would That's that successful hope that all markets continue in serve. be our the to they

can that serving. not would anything their in That a lot you have they're market be product ideas. our any do that goal would that success to of teams already had Our imagine truncate said, great

attractive digital things experience, prepared data I One Bryan about up process that that's talked think using earlier process a a if having transactional banking the and my natively really and of about in in talked design that is showing onboarding about client. the the then remarks, you're in is onboarding it you for the

that of how platform. not imagine a to ideas digital we've and MANTL, with lot going in got integrate marketing banking their in of we're our any terms product to market. with any So But anything you would we of success do truncate data

Operator

at There questions further are time. no this

conference disconnect. So participation, you call. Thank for and concludes this today's your now you may

Alkami Technology (ALKT) 27 Feb 252024 Q4 Earnings call transcript