Katapult Stock Dives As Q2 Profit, Margins Decline, Gross Originations Down 17%

E-commerce focused financial technology company Katapult Holdings Inc KPLT reported second-quarter FY21 revenue growth of 27.6% year-on-year to $77.5 million.
Rental revenue rose 28.8% Y/Y to $77.2 million.
Gross Originations declined 17% Y/Y to $64.4 million.
The company onboarded 31 new retailers.
Margins: The gross margin contracted 260 bps to 27.8% as the costs shot up 32.4% Y/Y. The non-GAAP gross margin contracted 650 bps to 15.5%.
A 216% increase in operating expenses led to an operating loss of $(8.95) million.
Adjusted net income reduced 70.4% Y/Y to $1.5 million.
Adjusted EBITDA decreased 64.8% Y/Y to $3.9 million, reflecting increased investment in growth initiatives, lower seasonal lease payment performance, new hire costs, and incremental public company costs. The margin declined by 1,320 bps to 5.1%.
Katapult reported a loss per share of $(0.17) versus EPS of $0.09 last year.
Katapult held $112.4 million in cash and equivalents.
Katapult removed explicit guidance for the remainder of 2021, citing current macro trends and uncertainty to predict consumer’s buying behaviors.
Price action: KPLT shares traded lower by 56.9% at $4.195 on the last check Tuesday.

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