BTM - Earnings call transcript Q2 2024

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Operator

Good morning, and welcome to Bitcoin Depot's Second Quarter 2024 Conference Call. My name is Sarah, and I'll be your operator today.

Before this call, Bitcoin Depot issued its financial results for the second quarter ended June 30, 2024, in a press release. A copy will be furnished in a report on Form 8-K filed with the SEC and will be available in the Investor Relations section of the company's website.

Joining us on today's call are Bitcoin Depot's CEO, Brandon Mintz; and CFO, Glen Leibowitz.

will call we questions. remarks, their open for the Following

Group Slach a please Before Cody Gateway proceed. will Slach, we begin, Mr. from make statement. brief introductory

Cody Slach

Thank you, morning, operator. Good everyone.

remind formal may today considered number forward-looking laws would begins of we're securities be remarks, under involve management some statements their like Before to and everyone statements risks that making uncertainties. we a and

actual many that results of materially described we result, a are a which differ there could events caution control, and you cause are to from which in of statements. As beyond the our factors, number those forward-looking

For relating the made to law. forward-looking or statements as to please earnings statements, more date any the uncertainties, events detailed in required except by and update forward-looking that release risks, disclaim and undertaking with to our our or circumstances disclosures the the assumptions statements reflect SEC. forward-looking after filings made, occur public are We see obligation

to financial our We disclosures earnings non-GAAP in our these will as reconciliation also release measures and metrics. discuss encourage carefully measures you you read with the to GAAP filings our to and refer the as consider not recent our of our variable and SEC disclosures uncertainties under but tables and as limited risk applicable for circumstances, We including, risks you uncertainties factors in descriptions other to well identified business, caption detailed the filings. and

presentation the QX at section IR SEC available is also link get made our Bitcoin for would Invest in Bitcoin being the made will by website supplemental to website. www.sec.gov. I and available A of via for has be may remind You Depot's Relations a our earnings website. Depot's filings this recorded highlighting SEC like available been performance visiting on replay everyone, call free

Brandon Now, Brandon? turn call CEO, Depot's Mintz. the over I Bitcoin to will

Brandon Mintz

in us Call. business and sequential income like recent what growth momentum in EBITDA. XXXX the our adjusted with gives across net Cody, joining built We've briefly our developments second year you and everyone. ahead. revenue, discuss the to for on Thank morning confidence Conference in our I'd quarter good Thanks, some and second quarter

growing We major continued a regional their on enhance footprint. and to partners building focus robust kiosk retail pipeline network and our to national of

we announced in In our achieved of ATMs initiatives up XXXX, in of just aimed kiosks with XX,XXX X we of first a down intention testament XXXX, and relentless no along over proudly our kiosks more ahead Bitcoin's the we with will accessibility. Building total crypto furthering This to cultivated dedication our and over already This, month fleet on industry-leading our exceeded market our the increase slowing X,XXX size our have of we deploying as even to ambitious the X,XXX ecosystem. kiosk gear is expanding over last all that are X,XXX customers acquisition of seamless months half momentum delivered, goal of to the schedule once with to fact, provide team kiosks. access Bitcoin at kiosks share. strategic we've

which locations, X new relocating profitability BTMs time. kiosk has increased per have historically over past on the heavily through we quarters, focused underperforming Over shown to average

do ramp not BTMs we up. the in While grow to time, the as immediately, profitability typically benefit increase continues get that over

as growth the relocation our working showing potential not it the of it's While today. numbers apparent consolidated for a into is sits baked in quarter, lot and strategy business is the

than since installed returning than are of one four kiosk performance at user roughly that share year, XX BTMs have we focused June and was to repositioning install Other averaged This to revenue while months our the our and BTMs installed optimization the months. key average for kiosk the footprint, on In per XX year calculation, will median location. for the higher of the size. It's for installed our been expand BTMs to in XX example, XX.X% operation this months lift efforts than us competitive less this of in the recent tell monthly optimize For months that transaction slow that time for kiosk quarters. is regularly transaction footprint likely note and year, positioning. coming market indicators growth count we consistency the include our process important less working in

to end X kiosks our X,XXX for year of than As and of more of their the thus potential. less need full been QX time installed around ramp-up have to still XXXX,

receive Additionally, the repair ordered time accounts baked XXX XX,XXX at maintenance is the the any and kiosks sits it and our potential we installed. BTMs over kiosks, will of the XXXX time. once today. transit the as from roughly install they ramp of kiosks number into Between and orders that there course very growth installed we are given of newly or reach by are all large all business purchases, about purchased delivery in our we total This undergoing suite kiosks of will of an for receive

store locations and XXX Furthering in our the fuel Beginning in retailers. Depot a Hampshire. retail in we and Energy deployed company-owned the partnership into quarter, C-stores leading North announced based Corporation, kiosks the new across brand Bitcoin convenience Nouria with Northeast second with Massachusetts, expansion American QX XX its New Maine operations area XXXX, across

Sopris. program sale to BTMs XXX with July, announced we Sopris also of We the share strengthen Capital. our continue to additional profit In

As in our Bitcoin with profit-sharing for the Sopris software operations. premier benefit operating Software, expertise like BitAccess our BTMs a ATM suite integration reminder, partners and from

in of provides installed program XX-year expansion Bitcoin for the share profit Depot's ATMs Our this Bitcoin aim we history. capital-efficient strategy company's as largest year, have the the fleet to

a in build-up growth pipeline, plan. our financials, are continued cash our our sales we growth and our to well-positioned strong execute dynamics, flow in sequential the Given

this reminder, a As categories. main comprises of plan three

expansion. international is First

anticipating We upcoming launch, regulatory have shipped over are XXX approval kiosks for soon. Australia and we our

with Rico Puerto kiosks over operational Additionally, installed. XXX fully is

are our focusing the footprint profit share and to Second, attention on program we profitability. additional grow

strategy profitability. capital-efficient can We for a pipeline of Bitcoin to year, enhancing this strong provide expanding Depot have a continue that while opportunities

our to continue expand pursue to access Third, licenses customers. for points we additional will

we State secure in economics dialogue to to be no coinatmradar.com, opportunity deployment approval, for license the be the hopefully, could our are in kiosk our not growth unit state. strong. this operators York operate some it updates With at for potential remains New our opportunity would regulators in expected we we state according in in existing moment, the do point At today the with to timeline believe and and will kiosks substantial largest any XXXX. on have for U.S., BTM regular but happen the

expansion announcements and will continue we growth our Lastly, in on Australia. Rico opportunities internationally beyond recent Puerto to explore

approximately are will globally outside growing opportunity the While adoption we a located, America. our presence BTMs market-leading focus cryptocurrency XX% remains of within North believe North us where an offer of establish of America, to

pace remain our by encouraged of opportunities this it's well-positioned and early, we While execute are our of year. retail new recent have identified to internationally. In momentum still by pipeline encouraged we deployments strategic are and summary, the we goals

more turn and into outlook. I'll financial the Now, business to Glen? our performance will over in-depth floor who insights CFO, Leibowitz, our provide Glen

Glen Leibowitz

discussion Thanks, XXXX good morning, everyone. outlook. I'll with results, a and second of finish Brandon, start with quarter we'll review our a and on detailed our

of January, legislation This with along our quarter XX% quarter during $XXX second profitability. year-over-year for $XXX kiosks impact decline that was unfavorable year's million maximum relocating went fleet the declined that in by Second the to passed approximately to revenue was for million, quarter. effect compared in optimize California driven largely to last into

engaged that legislature to to California We continue limitations in and are actively changes in seek currently in the with place their constructive operational state. are that

we was was for $X.X expense XXXX million transaction to a overall maximized to second continue driven in value The and This as million, compared quarter stock, of de-SPAC company. GAAP This the basis other lower compared $XX.X life second will kiosk the to of the expenses XX XXXX Series expansion quarter Brandon of Adjusted trend loss margin the the the during remains Adjusted an coming second $XX.X EBITDA, in $XX.X recorded increased the to $XX.X a repeat profitability. drive largely last was quarter gross of revenue XXXX. $XX lower compared second to second XXXX, was fair XX.X% quarter mentioned, of our quarter. was markets. Adjusted the margin This XXXX. million from of public year's of our approximate the did to further focus to quarter. second for to of optimize revenue second quarter as quarter million through profit growth as Total the million declined million year-ago optimizing in for to However, result improvement expenses related in this not second $XX.X we decreased in the expenses net our second attributable anticipate of quarter XXXX the away decreased the quarter XXXX. non-GAAP quarter points net of XX% to for second service by quarter second XXXX, driven measure, of the by to for million the second move quarter and to year's a second over XX.X% compared million for for of income quarter for $X current XXXX professional for the compared $XX.X gross XXXX. operating million of compared quarters increase to X% A preferred XXXX. of which to markup the

come increase with deploy of fixed asset margin, margin later more immediate future revenue XXXX. by XX% an in improvement, second as they quarter or revenue, which we compared is not EBITDA XXXX in the costs. Also, These in second but Adjusted to adjusted from EBITDA was a X.X%, are reminder, quarter do the we EBITDA and of divided deployments drive to growth XXXX, as expected in years. kiosks, derived

been the operations ended million second in flows of provided first flow leases. building and the approximately to by and A being cash strong debt, with approximately our of balance generated sheet equivalents our in cash million months with $XX and gained in cash our the for cash XXXX, driver were operations million X alone balance on continue of has as focus $XX.X and our We business quarter. quarter $XX.X $XX.X including efficiencies million cash in finance

sheet are asset second it investment, The the adoption benefit our This Additionally, our we treasury this as from small, significant build of but strategy. activate our store long-standing financial any current as on during our of part shareholders balance With value. underscores strategy. announced BTC this future a appreciation. should and allows Bitcoin in the we as amounts to quarter, belief also a Bitcoin of

additional our We committed to optimizing enhancements to improving and including costs, lowering vendor customer turning growth service Now professional to outlook. markups. drive profitability remain operational forward, pricing, going

not this We providing be time. guidance at will

relocation cash from the of business kiosks ramp for our decided the formal and variability the in refrain on profitability have are significant kiosks, We in the flow to guidance. focused start California and optimizing ahead. we revenue to positive business combined given legislation from year, the our Also, with the

However, with for still have we QX the and remainder we to previously, similar questions. are revenue in QX. With a as to significantly your higher of expect trend QX XXXX, that, take happy in follow and than now QX we Operator? seasonality described

Operator

comes Mike the first from line [Operator question Your of H.C. with Instructions] Wainwright. Colonnese

Michael Colonnese

great the made far a date you've here. on progress all XXXX so quarter Congrats in and to

if could for -- me, Treasury strategy Bitcoin one First provide your your just strategy. around you Bitcoin more details

guys cash aggressively but strong flow also You generating footprint. are your really expanding operating are here,

should your broader allocation the Bitcoin purchases of how think So we strategy? context future about within capital

Christopher Buchanan

question. This Thanks Buchanan. for Scott the Mike. Hey, is

don't excess going capital balance that continue future it cash to the like sheet We're stock with not we're at look even. we to there Bitcoin we adding build to the we cash aggressive, opportunities we onto our all to dividends consider buybacks along allocating to opportunistically. be and too for have but balance will the continue of or want in as other sheet using something remain the So

Michael Colonnese

thinking And then are evaluate as expand strategically to there? M&A flows of guys how potentially just in alternatives the financing increase also your to external scale outside out are organically, Got financing guys and footprint of but financing you to cash about you it. generating continue opportunities to operating here, some opportunities, terms you continue

Christopher Buchanan

just opportunistically. We're mean, We're Yes. it. open approach not to always opportunities. going force I to going to those M&A we're

we'll be continue operators to different sense, so conversations makes to in happy other something it. be we up adjacent industries. the after And And in space with go if or comes that

leasing possible, that capital as much we far as to as efficiently we kiosks. our we're our As fleet of look the continue kiosks, expand as financing so using to partners

Operator

B. line comes Riley Your next question the with from Goetsch Hal of Securities.

Harold Goetsch

It's I probably and York guys in a expansion. to just have on along? questions New this us on states more little more detail wanting on regulators or works? give one couple considering? of feed that kiosks a detail the what how are And on done for second what the to educate is a legislators remaining What's you Could your doing and of actually you Puerto end the little question the any there? be there, process Australia, what you. then What potential Thank Rico is on process other is you're needs in and Australia? the countries holdup regulatory

Brandon Mintz

for is Thanks Brandon. question, the Hal. This

as deny far applications by we've goes, the review this make York York stages Financial to New the the their committee a As New of submits in to decision that review application. been committee within Services. And that final approve or will team Department of the

team this Now part big we that process, during review is on passed of a unfortunately, somebody delay review believe the unfortunately away.

specifically Outside anything of from and that up be in we're slack a up the person expected holding speed aware application. It's on itself. to would not get and to So of our just that, Q&A them. had pick new come

So something York. still within There's be achieved editors hopefully, that New no state can of operating still year. this other it's the

such data Now we how anticipate in growing some We perspective I already. to on so in from perform. not will Also, as our share, new. footprint Puerto we deploy have believe, sales kiosks see those that kiosks island market on want market don't there the are the a significant future well. the the much, over to half we because Rico, more have really just kiosks very near share so need of there's

moment, we we as have do ready, we waiting earlier available as something believe We application do of XXXX. final State like at ready location application a application we process was the the we're this we're as in to are that year of have And stages terms process already kiosks it's our in in over the XXX Australia, soon U.S. deployed. and relationships Australia shorter In there submitted for York be New believe well. than At license

quarter far Australia XXXX opportunity. market. anticipate population Texas we Australia's of so Bitcoin at is launch solid or to will XXXX in of that X,XXX And happen typically that in So in time. Australia something is as ATMs the is terms sits at any the market within around very ranges looking goes. next still as Bitcoin And currently similar to somewhere X,XXX the ATMs given the Texas neighborhood the U.S. in in

to to Bitcoin gap years So, be to part and of the market there's that And grow has plan next of over by market Australia. a that thousands a the opportunity of in potential and big of big fill share. take ATMs couple piece we that a huge

Operator

the Northland line Your next from Markets. with question of Mike Capital comes Grondahl

Mike Grondahl

The new Nouria XXX already be stores many you in? those expect did in or to retailer, you're Energy, how of say

Brandon Mintz

and exact, here, It transcript. believe, Maine, is at I XX notes my around across Massachusetts, said look XX me Yes. I let in the be to -- New it Hampshire.

Mike Grondahl

are you where That's right now.

Brandon Mintz

the contract. what originally That's we've in taken

pending transit So these kiosks already them moment. are installed -- or are at some of the

Mike Grondahl

it. Got XX.

if Is last between of year, I should we with XQ? should XQ how strongest than stronger being But XQ. guys giving quarter. was Okay. that XQ XQ think back cognizant be seasonally something about look too, clearly And and you this and about year, not talked guidance? then you Or your XQ that we to

Brandon Mintz

is of over usually years, basis, it's if than look et slightly always revenue number relocating in we're kiosk. on kiosks, Well, it deploying per cetera, QX few the at on since past a and basis, you XQ hard or kiosk total a higher terms because per

Mike Grondahl

what's kind the last to think flow in guys Got about months, of And do there? six range cash the the it. half back then in what of the -- you year

Brandon Mintz

assume way of the what be easiest look the half first would is to I at continues. the year think to it

in than on significantly the flow of de-SPAC of lower half we year, little QX, is had we cash QX dragging but The terms still bit of were that more a first those expenses paying.

to we out. speaking even on So in past it'll QX, little basis I results. it than bit think should if behaves like just then has from a historical lower expect though similar And QX a the I'm Even somewhat a basis. see revenue

Mike Grondahl

debt, cash Bitcoin? you uses more what about you are address thinking Do cash? your want how you're buying just the with then Can for And Sure. to that generating? that about priorities that you're talk

Brandon Mintz

really options. now, exploring Right

have past strategy, for on and Treasury here I of up potential think weeks. Bitcoin dip picking opportunistic do and M&A over the couple with we there's that some opportunities. this were We the

a debt Our believe, of will has prepayment penalty end, that I QX year. at very of end next the

continue its A been starting So of future. that's true colors to which that another thing is to This consider prior really and is weren't quarter, business since as now we've show. de-SPAC to going a issue lot the in public, in related the cash-flowing expenses, are the well.

so And is future. value be based on the flow the enterprise with dividend-paying that this the number that this sits as world for it company kind of today, see very could cash a company now impressive even can that business the QX, of a in

that's to to Since incentivize want only direction accretive So and will out our this we're current so not just attract happy hopefully that another quarter business something always flow, the evaluate something investors keep are that these we the option. what options next be. to since over there do figure do forward. buy long-term, and to for cash additional options, moving and many will we shares trying best have this more but is and the investors Really,

the get weighing options those further allow answer clear you So in a will us future. to

Operator

Noble next Instructions] of from question Markets. comes [Operator line Capital the McCann with Your Pat

Patrick McCann

the quarter. on Congrats

me. Just a questions couple from quick of

that seeing the I expanding additional players interest? I'm their of in as about further? just a you dip Are franchising other wanting wondering getting to just of well? with toes if and more lot are in conversations that was all, curious, you First program, are

Brandon Mintz

on question, very are going Hey, well things Pat. that profit-sharing answer program. your To

well. where purchase Bitcoin results. to did have decided happy that those groups we Sopris at with as And the their the been additional press do competitors have Capital, profit-sharing initial have us have guys partners, moment us, because in over competitors an release seen, came to they were There a they the ATMs from You them to a talking from past of actually couple with XXX done new this, of ours and we us.

impressed business profit-sharing and those run provide it's of how were just organized very and partners how we we just how and think the reporting such. the I kind with

Bitcoin about partner current other ATMs operating our would possibly were worried So ones can of public want you, say, are that NASDAQ, they public were if provide inside somebody on and that business. And with ATM we what's know as to a such I fleet you going majority really competitors are are you about major really everything reality, the markets reporting private, in we're since operators, would of not level of not because on you vast don't disclosure and for provide. competitors Bitcoin that we two like the to the on our

So to trusted such more willing about learn publicly I our calls our a be the financials competition be share. not see and be details a may vendor able on to think doing this business more of we're lot everyone than with just to being as to this others that

Patrick McCann

you partnership any my locations a the around, Great. then could Thanks with that give was Nouria factors wondering pursue or are that if demographics, there's partnership. retailer the other want I key on particulate around in And customer those geographical any commentary locations? based to maybe that. there just for was you question

Brandon Mintz

Nouria terms per specifically. such enterprise excited that in us, larger revenue in -- accounts Well, we're solid trying are we're them state these in in about states so machine to the the but we're to for always numbers expanding of door, as pretty get going specifically

Operator

turn this session. time, to to over call Scott. our this I'd now concludes back the question-and-answer At like

Christopher Buchanan

We the you joining Thanks, company, have a for day. great and the call. following everybody, appreciate

Operator

us call. for you for Thank Bitcoin today conference Depot's joining

You may now disconnect.

Bitcoin Depot (BTM) 13 Aug 242024 Q2 Earnings call transcript