Bakkt Q2 Earnings Call Highlights

Key Points

• Bakkt reported $80.8 million in second-quarter GAAP net income and ended the period with $50.7 million in cash and restricted cash and no long-term debt. The company maintained its full-year transaction-volume target of approximately $2.5 billion, despite generating about $169 million in the quarter and $410 million in the first half.
• Payments contributed to transaction volume for the first time following the May infrastructure integration, while trading activity declined. Management expects cross-border payments, the Bakkt Widget and embedded-finance products to drive growth, with margins potentially higher in emerging-market payment corridors than in major-currency stablecoin transactions.
• Bakkt is targeting approximately 25,000 Agent monthly active users by year-end and expects co-branded cards and Neobank-as-a-Service to launch in the fourth quarter, subject to approvals. The company also expects to reach adjusted EBITDA breakeven sometime in Q4 2026, depending on client activation timing and scale.

Bakkt NYSE: BKKT reported second-quarter GAAP net income of $80.8 million, or $1.94 per diluted share, while management outlined plans to scale transaction activity across its markets, financial-agent and international strategic-investment businesses.

Chief Financial Officer Karen Alexander said the company ended the quarter with $50.7 million in cash and restricted cash and no long-term debt. She noted that the quarter’s GAAP results included a fair-value remeasurement related to Transchem, while Bakkt also excluded $3.6 million in transaction-related advisory fees from adjusted EBITDA because it does not expect those costs to recur at the same level.

Bakkt reported Total Transacting Volume, or TTV, of about $169 million for the second quarter and approximately $410 million for the first half of 2026. Management maintained its target of roughly $2.5 billion in TTV for the full year, which would require a substantial acceleration during the second half.

Payments Join TTV as Trading Activity Declines

Chief Commercial Officer Daniel Ishag said second-quarter TTV declined principally because of lower trading activity. However, payments contributed to the measure for the first time after the company integrated its payments infrastructure on May 1.

“The initial production volume is an important proof point,” Ishag said, adding that it demonstrated the payments infrastructure was operating in-house and processing institutional and cross-border transactions.

Bakkt said it now has six live commercial offerings: trading infrastructure, stablecoin over-the-counter services, digital-asset over-the-counter services, stablecoin on- and off-ramping, cross-border payments through the Gyzer API, and the Bakkt Widget, an embeddable on- and off-ramp for partners.

The company also said it consolidated onboarding across its product suite and launched wire and ACH funding during the quarter. Bakkt’s platform supports access across more than 63 countries, 19 currencies and 10 public blockchains, according to Ishag.

Management expects payments to become a larger growth contributor as client integrations move through compliance, technical and launch stages. Bakkt said its full-year TTV outlook is not solely dependent on a recovery in trading activity, citing expected activations across payments, the widget and embedded-finance products.

Margin Potential Varies by Product and Corridor

During the question-and-answer session, CEO Akshay Naheta said transaction economics differ materially by activity. Stablecoin-related volume involving the U.S. dollar, euro and British pound tends to generate slim margins, ranging from a few basis points to the low teens in basis points, he said.

Cross-border payment activity, particularly in markets outside major currencies, can carry margins ranging from about 50 basis points to nearly 1.5 percentage points, Naheta said. Bakkt did not provide guidance for a blended take rate, though he said investors could begin seeing more evidence of where that rate may settle starting next quarter.

Ishag said the company is seeing demand for cross-border payments in emerging markets and emphasized the potential savings for clients from using an integrated platform rather than maintaining multiple onboarding and infrastructure relationships.

Agent Products and Year-End User Target

Bakkt described its Agent business as a business-to-business and business-to-business-to-consumer platform through which banks, fintechs and brands can offer financial products to their customers. The platform combines regulated accounts, payments, cards and cross-border transfers with financial intelligence and customer-facing interfaces, according to the company.

Embedded finance is commercially available for partner integrations, while Bakkt expects co-branded card programs and its Neobank-as-a-Service offering to launch in the fourth quarter, subject to required approvals and other regulatory, licensing, bank-partner and network requirements.

The company set an initial year-end target of approximately 25,000 Monthly Active Users for Bakkt Agent. Bakkt said it is not yet reporting meaningful Agent activity, but expects commercial end-user launches to begin as partners activate. It plans to report MAUs quarterly once activity becomes meaningful.

Naheta said Bakkt’s near-term capital focus is not on major new allocations beyond previously disclosed investments. Instead, he said the company is focused on adding commercial talent and activating existing client relationships to increase transaction volume and revenue.

Japan and India Investments Form Bakkt Global Strategy

Bakkt also highlighted its Bakkt Global business, which includes strategic positions in Japan and India. Management said its Japan investment, Bitcoin Japan, provides relationships and potential asset supply related to private markets and real-world asset tokenization. In India, the company is pursuing a broker-led distribution strategy through Transchem, which Bakkt expects to rename subject to approvals.

Bakkt reported Strategic Asset Value of approximately $119 million as of June 30. The company revised the metric’s definition to align with its financial statements: it includes a $10.6 million equity-method carrying value for the Japan investment and $107.9 million in fair value for Transchem warrants.

Looking ahead, Naheta said Bakkt expects TTV growth to accelerate into 2027, though the company did not provide financial guidance for next year. He also said Bakkt expects to reach adjusted EBITDA breakeven at some point during the fourth quarter of 2026, depending principally on the timing and scale of client activations.

About Bakkt (NYSE:BKKT)

Bakkt Holdings, Inc 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.

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