PART I - FINANCIAL INFORMATION [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) Unaudited consolidated financial statements for Q1 2024, covering balance sheets, income, equity, cash flows, and extensive notes [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) The consolidated balance sheets present the company's financial position as of March 31, 2024, detailing assets, liabilities, and equity | Metric (in thousands) | March 31, 2024 (unaudited) | December 31, 2023 | | :-------------------- | :------------------------- | :------------------ | | **Assets** | | | | Total current assets | $51,706 | $37,270 | | Total assets | $90,070 | $77,377 | | **Liabilities** | | | | Total current liabilities | $44,551 | $46,025 | | Total Liabilities | $85,089 | $68,004 | | **Equity** | | | | Total Stockholders' Equity | $4,981 | $9,373 | - Total assets increased by **$12.7 million** from December 31, 2023, to March 31, 2024, primarily driven by an increase in cash and cash equivalents[5](index=5&type=chunk) - Total liabilities increased by **$17.1 million**, mainly due to a significant increase in non-current notes payable[8](index=8&type=chunk) [Consolidated Statements of (Loss) Income and Comprehensive (Loss) Income](index=6&type=section&id=Consolidated%20Statements%20of%20(Loss)%20Income%20and%20Comprehensive%20(Loss)%20Income) This statement outlines the company's Q1 2024 financial performance, showing a shift from net income to a net loss year-over-year | Metric (in thousands) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Revenue | $138,539 | $163,603 | | Cost of revenue (excluding D&A) | $121,287 | $141,300 | | Income from operations | $699 | $8,671 | | Total other (expense) | $(5,065) | $(3,210) | | Net (loss) income | $(4,228) | $6,083 | | (Loss) per share basic and diluted | $(0.25) | N/A | - Revenue decreased by **15.3%** year-over-year, from $163.6 million in Q1 2023 to $138.5 million in Q1 2024[10](index=10&type=chunk) - The company reported a **net loss of $4.2 million** in Q1 2024, a significant decline from a **net income of $6.1 million** in Q1 2023[10](index=10&type=chunk) [Consolidated Statement of Changes in Stockholders' Equity](index=7&type=section&id=Consolidated%20Statement%20of%20Changes%20in%20Stockholders'%20Equity) This statement details changes in stockholders' equity for Q1 2024, reflecting distributions, share-based compensation, and net loss | Metric (in thousands) | January 1, 2024 | March 31, 2024 | | :-------------------- | :-------------- | :------------- | | Total Stockholders' (Deficit) Attributable to Bitcoin Depot Inc. | $(15,814) | $(16,617) | | Non-Controlling Interest | $25,187 | $21,598 | | Total Stockholders' Equity | $9,373 | $4,981 | - Total Stockholders' Equity decreased from **$9.373 million** at January 1, 2024, to **$4.981 million** at March 31, 2024, primarily due to net loss attributable to Bitcoin Depot Inc. and distributions[12](index=12&type=chunk) [Consolidated Statement of Changes in Member's Equity](index=8&type=section&id=Consolidated%20Statement%20of%20Changes%20in%20Member's%20Equity) This statement presents changes in member's equity for Q1 2023, showing the impact of distributions, share-based compensation, and net income | Metric (in thousands) | January 1, 2023 | March 31, 2023 | | :-------------------- | :-------------- | :------------- | | Total Member's Equity | $9,444 | $15,213 | | Net income (loss) | N/A | $6,083 | | Distributions | N/A | $(505) | - Total Member's Equity increased from **$9.444 million** at January 1, 2023, to **$15.213 million** at March 31, 2023, driven by net income and share-based compensation, partially offset by distributions[14](index=14&type=chunk) [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) The consolidated statements of cash flows detail inflows and outflows from operating, investing, and financing activities for Q1 2024 and 2023 | Metric (in thousands) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Net Cash Flows Provided by Operations | $1,347 | $10,010 | | Net Cash Flows Used In Investing Activities | $(558) | $0 | | Net Cash Flows Provided by (Used In) Financing Activities | $11,563 | $(5,886) | | Net change in cash and cash equivalents | $12,392 | $4,125 | | Cash and cash equivalents - end of period | $42,151 | $41,665 | - Net cash provided by operating activities significantly decreased from **$10.010 million** in Q1 2023 to **$1.347 million** in Q1 2024[17](index=17&type=chunk) - Financing activities shifted from a net cash outflow of **$5.886 million** in Q1 2023 to a net cash inflow of **$11.563 million** in Q1 2024, primarily due to proceeds from notes payable[17](index=17&type=chunk) [Notes to Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) These notes provide detailed explanations and disclosures for the consolidated financial statements, covering policies, transactions, and contingencies [(1) Organization and Background](index=11&type=section&id=(1)%20Organization%20and%20Background) This section describes Bitcoin Depot's BTM business, liquidity, and regulatory risks in the cryptocurrency industry - Bitcoin Depot operates a network of cryptocurrency kiosks (BTMs) and offers BDCheckout for buying/selling cryptocurrencies, along with a software solution for other BTM operators[23](index=23&type=chunk) - As of March 31, 2024, the company had current assets of **$51.7 million** and current liabilities of **$44.6 million**, with **$42.2 million** in cash and cash equivalents[26](index=26&type=chunk) - Regulatory changes, such as California's new law limiting crypto kiosk transactions to **$1,000 per day** and imposing fee caps, pose significant risks to the company's financial performance and expansion[27](index=27&type=chunk)[29](index=29&type=chunk)[30](index=30&type=chunk) [(2) Basis of Presentation and Summary of Significant Accounting Policies](index=12&type=section&id=(2)%20Basis%20of%20Presentation%20and%20Summary%20of%20Significant%20Accounting%20Policies) This section details the basis of preparing interim financial statements, covering GAAP compliance, merger accounting, and key accounting policies - The Merger with GSR II Meteora Acquisition Corp. on June 30, 2023, was accounted for as a reverse recapitalization, with Legacy Bitcoin Depot identified as the predecessor[38](index=38&type=chunk) - Cryptocurrencies are accounted for as indefinite-lived intangible assets at cost, less any impairments, and are tested for impairment annually or more frequently if indicators arise[51](index=51&type=chunk)[53](index=53&type=chunk) - Revenue is primarily derived from the sale of cryptocurrencies at BTM kiosks and through BDCheckout, recognized when control is transferred to the customer, with the Company acting as the principal[61](index=61&type=chunk)[62](index=62&type=chunk)[64](index=64&type=chunk) [(3) Recent Accounting Pronouncements](index=25&type=section&id=(3)%20Recent%20Accounting%20Pronouncements) This section outlines recently adopted and pending accounting pronouncements, including updates on business combinations and crypto assets - The company adopted ASU 2021-08 (Business Combinations) and ASU 2022-03 (Fair Value Measurement of Equity Securities) effective January 1, 2023, and January 1, 2024, respectively, with no material impact[93](index=93&type=chunk) - ASU 2023-08, effective for fiscal years beginning after **December 15, 2024**, will require crypto assets to be measured at fair value with changes reflected in net income, a significant change from the current indefinite-lived intangible asset accounting[97](index=97&type=chunk) [(4) Related Party Transactions](index=26&type=section&id=(4)%20Related%20Party%20Transactions) This section details transactions with related parties, including distributions and the Tax Receivable Agreement | Metric (in thousands) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Cash distributions to BT Assets | $0.9 | $0.5 | - The company is party to a Tax Receivable Agreement, requiring payment of **85%** of tax savings realized from certain tax attributes to BT Assets, with a liability of **$0.9 million** as of March 31, 2024[99](index=99&type=chunk)[157](index=157&type=chunk) [(5) Revenue](index=26&type=section&id=(5)%20Revenue) This section disaggregates revenue by stream for the three months ended March 31, 2024, and 2023 | Revenue Stream (in thousands) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :---------------------------- | :-------------------------------- | :-------------------------------- | | BTM Kiosks | $137,776 | $163,025 | | BDCheckout | $210 | $360 | | Company Website | $361 | $80 | | Software Services | $136 | $138 | | Hardware Revenue | $56 | $0 | | Total Revenue | $138,539 | $163,603 | - BTM Kiosks remain the primary revenue source, though it decreased by **15.5%** YoY. Company Website revenue saw a significant increase of **351.3%** YoY[101](index=101&type=chunk) [(6) Cost of Revenue (Excluding Depreciation and Amortization)](index=27&type=section&id=(6)%20Cost%20of%20Revenue%20(Excluding%20Depreciation%20and%20Amortization)) This section details cost of revenue components for Q1 2024 and 2023, excluding D&A, focusing on crypto, lease, and kiosk expenses | Cost of Revenue Category (in thousands) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :------------------------------------ | :-------------------------------- | :-------------------------------- | | Cryptocurrency expenses | $108,464 | $127,661 | | Floorspace lease expenses | $8,536 | $9,032 | | Kiosk operations expenses | $4,287 | $4,607 | | Total Cost of Revenue (excluding D&A) | $121,287 | $141,300 | | Cryptocurrency Expense Components (in thousands) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :----------------------------------------------- | :-------------------------------- | :-------------------------------- | | Cost of Cryptocurrency - BTM Kiosk | $108,063 | $127,090 | | Software Processing Fees | $0 | $205 | | Mining Fees | $218 | $33 | | Impairment of cryptocurrencies | $2,100 | $2,200 | - Total cost of revenue (excluding D&A) decreased by **14.2%** YoY, largely driven by a **15.0%** decrease in cryptocurrency expenses[104](index=104&type=chunk) - Impairment losses of **$2.1 million** and **$2.2 million** were recognized for the three months ended March 31, 2024, and 2023, respectively[105](index=105&type=chunk)[123](index=123&type=chunk) [(7) Fair Value Measurements](index=28&type=section&id=(7)%20Fair%20Value%20Measurements) This section discusses fair value measurements for contingent consideration, non-financial assets, cryptocurrencies, and safeguarding liabilities - The contingent consideration related to the BitAccess acquisition was settled in July 2023 with a **$2.0 million** payment[108](index=108&type=chunk) - Cryptocurrencies and safeguarding liabilities are measured at fair value on a recurring basis using Level 1 inputs (quoted prices on active exchanges)[110](index=110&type=chunk) - The estimated fair value of fixed-rate notes payable was **$37.8 million** as of March 31, 2024, compared to a carrying value of **$39.3 million**, using Level 2 valuation inputs[112](index=112&type=chunk) [(8) Prepaid expenses and other current assets](index=30&type=section&id=(8)%20Prepaid%20expenses%20and%20other%20current%20assets) This table presents the breakdown of prepaid expenses and other current assets as of March 31, 2024, and December 31, 2023 | Metric (in thousands) | March 31, 2024 | December 31, 2023 | | :-------------------- | :------------- | :---------------- | | Prepaid expenses | $1,801 | $2,334 | | Cryptocurrency safeguarding asset | $4,888 | $3,040 | | Other current assets | $2,077 | $1,180 | | Total | $8,766 | $6,554 | - Cryptocurrency safeguarding asset significantly increased from **$3.04 million** to **$4.888 million**, reflecting changes in fair values and quantity held[113](index=113&type=chunk) [(9) Accrued expenses and other current liabilities](index=30&type=section&id=(9)%20Accrued%20expenses%20and%20other%20current%20liabilities) This table presents the breakdown of accrued expenses and other current liabilities as of March 31, 2024, and December 31, 2023 | Metric (in thousands) | March 31, 2024 | December 31, 2023 | | :-------------------- | :------------- | :---------------- | | Payables to liquidity providers | $4,414 | $5,143 | | Cryptocurrency safeguarding liability | $4,888 | $3,040 | | Accrued expenses | $9,567 | $13,362 | | Total | $18,869 | $21,545 | - Cryptocurrency safeguarding liability increased from **$3.04 million** to **$4.888 million**, mirroring the increase in the safeguarding asset[114](index=114&type=chunk) [(10) Non-controlling Interests](index=30&type=section&id=(10)%20Non-controlling%20Interests) This section details changes in non-controlling interests for BitAccess and BT HoldCo, including ownership and accounting | Metric (in thousands) | January 1, 2024 | March 31, 2024 | | :-------------------- | :-------------- | :------------- | | Total Non-controlling Interest | $25,187 | $21,598 | | Net income (loss) | N/A | $(2,690) | | Distributions | N/A | $(916) | - Non-controlling interest in BT HoldCo was **72.7%** as of March 31, 2024, and is determined using the Hypothetical Liquidation at Book Value (HLBV) method[120](index=120&type=chunk)[121](index=121&type=chunk) [(11) Cryptocurrencies](index=31&type=section&id=(11)%20Cryptocurrencies) This section details cryptocurrency transactions, including purchases, sales, impairment losses, and adjusted cost basis | Metric (in thousands) | Three Months Ended March 31, 2024 (BTC) | Three Months Ended March 31, 2023 (BTC) | | :-------------------- | :-------------------------------------- | :-------------------------------------- | | Beginning balance | $711 | $523 | | Purchases/receipts | $108,094 | $127,530 | | Sales/distributions | $(106,303) | $(125,465) | | Impairment | $(2,062) | $(2,187) | | Ending balance | $440 | $401 | [(12) Notes Payable](index=33&type=section&id=(12)%20Notes%20Payable) This section details the company's credit agreements and notes payable, including amendments, refinancing, and future payments - On March 26, 2024, the company amended its credit agreement, increasing the principal financing by **$15.7 million** to a total of **$35.6 million**[129](index=129&type=chunk) - The amendment resulted in a **$3.2 million** loss on extinguishment of debt, including a **$2.7 million** write-off of unamortized deferred loan costs[129](index=129&type=chunk) | Metric (in thousands) | March 31, 2024 | December 31, 2023 | | :-------------------- | :------------- | :---------------- | | Total notes payable | $39,300 | $21,086 | | Notes payable, non-current | $35,863 | $17,101 | [(13) Common Stock, Preferred Stock and Stockholders' Equity](index=35&type=section&id=(13)%20Common%20Stock,%20Preferred%20Stock%20and%20Stockholders'%20Equity) This section details authorized and outstanding shares of common and preferred stock, warrants, earnouts, and the share repurchase program | Stock Class | Shares Authorized | Shares Outstanding (March 31, 2024) | | :---------- | :---------------- | :---------------------------------- | | Class A Common Stock | 800,000,000 | 13,531,071 | | Class V Common Stock | 300,000,000 | 44,100,000 | | Class E Common Stock | 2,250,000 | 1,075,761 | | Series A Preferred Stock | 50,000,000 | 3,075,000 | - As of March 31, 2024, **43,848,750 warrants** were outstanding, entitling holders to purchase Class A common stock at **$11.50 per share**[144](index=144&type=chunk) - The company repurchased **69,976 shares** of Class A common stock for **$0.2 million** during Q1 2024, with **$9.6 million** remaining under the **$10.0 million** share repurchase program[150](index=150&type=chunk) [(14) Income Taxes](index=38&type=section&id=(14)%20Income%20Taxes) This section discusses the company's income tax treatment, effective tax rates, deferred tax assets, and the Tax Receivable Agreement - The effective tax rate for Q1 2024 was **3.21%**, compared to **(11.4)%** in Q1 2023[152](index=152&type=chunk) - A full valuation allowance has been established against deferred tax assets related to the investment in BT HoldCo, as realization is not considered more likely than not[155](index=155&type=chunk) - The Tax Receivable Agreement liability was **$0.9 million** as of March 31, 2024, representing **85%** of tax savings realized by Bitcoin Depot Inc. due to certain tax attributes[157](index=157&type=chunk) [(15) Share-Based Compensation](index=39&type=section&id=(15)%20Share-Based%20Compensation) This section details share-based compensation plans, including stock option and RSU activity and recognized expenses - The company recognized **$0.9 million** in share-based compensation expense during Q1 2024 under the 2023 Omnibus Incentive Plan, primarily for time-based RSUs[163](index=163&type=chunk)[165](index=165&type=chunk) - As of March 31, 2024, there was **$2.3 million** in unrecognized compensation expense associated with time-based RSUs[165](index=165&type=chunk) [(16) Net Loss Per Share](index=42&type=section&id=(16)%20Net%20Loss%20Per%20Share) This section presents the calculation of basic and diluted net loss per share for Q1 2024 and lists anti-dilutive securities | Metric | Three Months Ended March 31, 2024 | | :----- | :-------------------------------- | | Net loss attributable to Bitcoin Depot Inc. | $(4,228) (in thousands) | | Weighted average common stock outstanding | 16,616,864 | | Net loss per share | $(0.25) | - Securities such as Public and Private Warrants (**43.8 million**), Class E Common Stock Earnouts (**1.1 million**), and BT OpCo Earnouts (**15 million**) were not included in diluted EPS as their effect would be anti-dilutive or contingent conditions were not met[169](index=169&type=chunk) [(17) Leases](index=44&type=section&id=(17)%20Leases) This section details the company's lease obligations for floorspace, office space, and BTM kiosks, including terms and expenses | Lease Expense (in thousands) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--------------------------- | :-------------------------------- | :-------------------------------- | | Total finance lease expense | $1,636 | $3,322 | | Operating lease expense | $100 | $53 | | Short-term lease expense | $8,476 | $9,032 | | Total lease expense | $10,212 | $12,407 | - Total lease expense decreased by **$2.195 million** YoY, primarily due to a reduction in finance lease expenses[176](index=176&type=chunk) - The weighted-average discount rate for finance leases was **18.1%** and for operating leases was **17.4%** as of March 31, 2024[177](index=177&type=chunk) [(18) Commitments and Contingencies](index=46&type=section&id=(18)%20Commitments%20and%20Contingencies) This section addresses the company's legal proceedings and potential impacts from financial and tax regulations - The company is involved in a lawsuit with Canaccord Genuity Corp. seeking **$23.0 million** in damages for alleged breach of contract, with the matter moving into the discovery phase in March 2024[183](index=183&type=chunk)[184](index=184&type=chunk) - The company believes adequate provisions have been made for probable losses but cannot estimate the amount or range of loss in excess of accrued amounts for certain contingencies[181](index=181&type=chunk) [(19) Subsequent Events](index=48&type=section&id=(19)%20Subsequent%20Events) This section reports significant events after the reporting period, including a kiosk acquisition and new RSU grants - In March 2024, the company entered a binding term sheet to acquire kiosks valued at approximately **$4.6 million**, with expected receipt over several months[186](index=186&type=chunk) - In April 2024, the company granted approximately **580,000 PSUs** and **1 million time-based RSUs** with a total fair value of **$3.0 million**[186](index=186&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=49&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management's discussion and analysis of financial condition and results of operations, covering business, metrics, liquidity, and non-GAAP measures [Business Overview](index=49&type=section&id=Business%20Overview) Bitcoin Depot operates North America's largest BTM network, providing digital financial access via kiosks, BDCheckout, and a mobile app - Bitcoin Depot's mission is to bring Crypto to the Masses™ by enabling cash-to-Bitcoin conversions via BTMs and a mobile app[191](index=191&type=chunk) - As of March 31, 2024, the company had approximately **7,100 BTMs** and BDCheckout available at approximately **6,700 retail locations**[192](index=192&type=chunk) [Kiosk Network and Retailer Relationships](index=49&type=section&id=Kiosk%20Network%20and%20Retailer%20Relationships) This section describes BTM kiosk usage and highlights key retailer partnerships, including the exclusive agreement with Circle K - Users can purchase Bitcoin with cash at BTM kiosks by providing information for account creation, scanning a QR code for their digital wallet, and inserting cash[193](index=193&type=chunk) - Bitcoin Depot is the exclusive provider and operator of BTMs for Circle K in the U.S. and Canada, with approximately **1,300 BTMs** installed in Circle K stores as of March 31, 2024[194](index=194&type=chunk) [Cryptocurrencies (Management Process)](index=49&type=section&id=Cryptocurrencies%20(Management%20Process)) This section explains Bitcoin Depot's strategy for managing Bitcoin exposure and working capital requirements - The company maintains a relatively low balance of Bitcoin (typically less than **$0.8 million**) to reduce exposure to price volatility, purchasing Bitcoin on a just-in-time basis from liquidity providers[196](index=196&type=chunk) - Cash in BTM kiosks was approximately **24.5%** of average monthly revenues for the trailing twelve months ended March 31, 2024[198](index=198&type=chunk) [The Merger](index=51&type=section&id=The%20Merger) This section summarizes the June 30, 2023 merger, including corporate restructuring and share issuances - The merger with GSRM was consummated on June 30, 2023, resulting in GSRM being renamed Bitcoin Depot Inc. and a significant restructuring of the company's capital stock[199](index=199&type=chunk) - The restructuring involved the formation of BT HoldCo LLC, issuance of various classes of common and preferred stock, and the issuance of 44,100,000 non-economic Class V common shares to BT Assets[199](index=199&type=chunk) [Regulatory Environment](index=51&type=section&id=Regulatory%20Environment) This section discusses the evolving cryptocurrency regulatory landscape and its impact on operations, highlighting California legislation - The company operates in a rapidly evolving regulatory environment with increased focus on payments, anti-money laundering, privacy, and consumer protection[200](index=200&type=chunk) - New California laws, effective January 1, 2024, limit crypto kiosk transactions to **$1,000 per day**, impacting the company's revenue in the state[200](index=200&type=chunk) [Key Business Metrics](index=53&type=section&id=Key%20Business%20Metrics) This section presents key operational metrics for performance measurement, including installed kiosks, user transactions, and BDCheckout locations | Metric | March 31, 2024 | December 31, 2023 | March 31, 2023 | | :--------------------------- | :------------- | :---------------- | :------------- | | Installed kiosks (at period end) | 7,061 | 6,334 | 6,441 | | Returning user transaction count | 7.7 | 8.3 | 10.0 | | Median kiosk transaction size (in $) | 205 | 200 | 200 | | BDCheckout locations (at period end) | 6,734 | 5,681 | 2,754 | - Installed kiosks increased to **7,061** by March 31, 2024, from **6,441** a year prior, indicating market penetration and growth[203](index=203&type=chunk) - Returning user transaction count decreased from **10.0** in Q1 2023 to **7.7** in Q1 2024, suggesting a decline in user retention or transaction frequency[203](index=203&type=chunk) [Segment Reporting](index=54&type=section&id=Segment%20Reporting) The company operates as a single reportable segment due to similar customer base, economic characteristics, products, and services - Bitcoin Depot operates as one operating and reportable segment, with substantially all revenues and long-lived assets located in the U.S.[208](index=208&type=chunk) [Components of Results of Operations](index=55&type=section&id=Components%20of%20Results%20of%20Operations) This section defines key components of results of operations: revenue, cost of revenue (excluding D&A), operating expenses, and other income/expense - Revenue is primarily generated from Bitcoin sales at kiosks, including a markup (**15%-31%** for BTMs, **15%** for BDCheckout) and a flat transaction fee (**$3.00** for BTMs, **$3.50** for BDCheckout)[209](index=209&type=chunk)[210](index=210&type=chunk)[211](index=211&type=chunk) - Cost of revenue includes cryptocurrency costs, fees, impairment, floorspace lease expenses, and kiosk operations expenses (repair, maintenance, armored trucks)[213](index=213&type=chunk) - Operating expenses comprise selling, general and administrative costs (customer support, marketing, professional services, payroll) and depreciation and amortization[215](index=215&type=chunk)[216](index=216&type=chunk)[217](index=217&type=chunk) [Results of Operations](index=57&type=section&id=Results%20of%20Operations) This section compares Q1 2024 and Q1 2023 financial performance, analyzing changes in revenue, cost of revenue, operating expenses, and net income/loss | Metric (in thousands) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | Change ($) | Change (%) | | :-------------------- | :-------------------------------- | :-------------------------------- | :--------- | :--------- | | Revenue | $138,539 | $163,603 | $(25,064) | (15.3)% | | Cost of revenue (excluding D&A) | $121,287 | $141,300 | $(20,013) | (14.2)% | | Income from operations | $699 | $8,671 | $(7,972) | (91.9)% | | Net (loss) income | $(4,228) | $6,083 | $(10,311) | (169.5)% | - Revenue decreased by **15.3%** primarily due to lower kiosk transaction volume and regulatory limits in California, despite a **6%** increase in average kiosks in service[219](index=219&type=chunk)[222](index=222&type=chunk) - Selling, general and administrative expenses increased by **25.6%** due to higher payroll costs (headcount increased from **92 to 138**) and increased professional services for regulatory and lobbying efforts[233](index=233&type=chunk) - Other expenses increased by **57.8%** due to higher interest expense and a **$3.2 million** loss on extinguishment of debt from a credit agreement amendment[234](index=234&type=chunk) [Liquidity and Capital Resources](index=61&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses working capital, cash flow, Bitcoin management, capital requirements, and the share repurchase program | Metric (in thousands) | March 31, 2024 | December 31, 2023 | | :-------------------- | :------------- | :---------------- | | Working capital | $7,200 | $(8,800) | | Cash and cash equivalents | $51,700 | $37,300 | | Net (loss) income | $(4,200) | $1,500 | - Working capital improved significantly from a negative **$8.8 million** at December 31, 2023, to a positive **$7.2 million** at March 31, 2024[238](index=238&type=chunk)[239](index=239&type=chunk) - The company believes existing cash and cash equivalents, combined with cash from operations, will be sufficient for the next 12 months[241](index=241&type=chunk) [Non-GAAP Financial Measures](index=63&type=section&id=Non-GAAP%20Financial%20Measures) This section defines and reconciles non-GAAP financial measures, Adjusted Gross Profit and Adjusted EBITDA, to comparable GAAP measures | Metric (in thousands) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Gross Profit | $14,371 | $19,507 | | Adjusted Gross Profit | $17,252 | $22,303 | | Gross Profit Margin | 10.4% | 11.9% | | Adjusted Gross Profit Margin | 12.5% | 13.6% | | Metric (in thousands) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Net (loss) income | $(4,228) | $6,083 | | Adjusted EBITDA | $4,885 | $13,633 | | Adjusted EBITDA margin | 3.5% | 8.3% | - Adjusted EBITDA decreased significantly from **$13.6 million** in Q1 2023 to **$4.9 million** in Q1 2024, with the margin declining from **8.3%** to **3.5%**[250](index=250&type=chunk) [Sources of Liquidity](index=65&type=section&id=Sources%20of%20Liquidity) This section details the company's credit agreement, including recent amendments and their financial impact - The credit agreement was amended on March 26, 2024, to provide an additional **$15.7 million** in principal financing, increasing the total term loan facility to **$35.6 million**[252](index=252&type=chunk) - This amendment was accounted for as an extinguishment of debt, resulting in a **$3.2 million** loss from the write-off of deferred financing costs[252](index=252&type=chunk) [Cash Flows](index=66&type=section&id=Cash%20Flows) This section analyzes changes in cash flows from operating, investing, and financing activities for Q1 2024 versus prior year | Cash Flow Activity (in thousands) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Operating Activities | $1,347 | $10,010 | | Investing Activities | $(558) | $0 | | Financing Activities | $11,563 | $(5,886) | | Net increase in cash and cash equivalents | $12,392 | $4,125 | - Net cash from operating activities decreased by **$8.7 million**, primarily due to a **$10.3 million** decrease in net income[254](index=254&type=chunk) - Net cash from financing activities increased by **$17.4 million**, driven by a **$15.2 million** increase in proceeds from notes payable[256](index=256&type=chunk) [Commitments and Contractual Obligations](index=66&type=section&id=Commitments%20and%20Contractual%20Obligations) This section summarizes the company's aggregate operating and finance lease obligations - As of March 31, 2024, the aggregate amount of operating and finance lease obligations was approximately **$8.9 million**[257](index=257&type=chunk) [Commitments and Contingencies (Litigation)](index=66&type=section&id=Commitments%20and%20Contingencies%20(Litigation)) This section reiterates the company's legal proceedings and its assessment of potential losses - The company is involved in various lawsuits and claims in the ordinary course of business, including a **$23.0 million** claim from Canaccord Genuity Corp[261](index=261&type=chunk)[277](index=277&type=chunk) - Management believes adequate provisions have been made for probable losses but cannot estimate the amount or range of loss in excess of accrued amounts for certain contingencies[262](index=262&type=chunk) [Off-Balance Sheet Arrangements](index=68&type=section&id=Off-Balance%20Sheet%20Arrangements) The company reported no off-balance sheet arrangements - Bitcoin Depot Inc. has no off-balance sheet arrangements[263](index=263&type=chunk) [Recently Issued Accounting Standards](index=68&type=section&id=Recently%20Issued%20Accounting%20Standards) This section updates on recently adopted and pending accounting standards, including those for business combinations and crypto assets - ASU 2023-08, effective for fiscal years beginning after **December 15, 2024**, will require crypto assets to be measured at fair value with changes reflected in net income, a shift from the current indefinite-lived intangible asset accounting[267](index=267&type=chunk) - The company is currently assessing the impacts of several pending ASUs, including those on disclosure improvements, segment reporting, and income tax disclosures[264](index=264&type=chunk)[265](index=265&type=chunk)[266](index=266&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=70&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to market risks from foreign currency exchange rates and interest rates, managed through normal operations - Bitcoin Depot is exposed to market risk from fluctuations in foreign currency exchange rates and interest rates[269](index=269&type=chunk) [Item 4. Controls and Procedures](index=70&type=section&id=Item%204.%20Controls%20and%20Procedures) This section discusses disclosure controls, identifies material weaknesses in internal control, and outlines remediation efforts - Management concluded that disclosure controls and procedures were not effective as of March 31, 2024, due to material weaknesses in internal control over financial reporting[270](index=270&type=chunk) - Identified material weaknesses include lack of formalized internal control systems, reliance on IT systems without proper evaluation, insufficient technical accounting resources, inadequate controls over cryptocurrencies, and ineffective reconciliation controls over cash in transit[271](index=271&type=chunk) - Remediation efforts involve hiring additional qualified personnel, enhancing accounting processes, and designing/implementing new controls, with no assurance of immediate or complete remediation[272](index=272&type=chunk) PART II - OTHER INFORMATION [Item 1. Legal Proceedings](index=73&type=section&id=Item%201.%20Legal%20Proceedings) This section updates on significant legal proceedings involving Canaccord Genuity Corp. and other routine matters - Canaccord Genuity Corp. commenced proceedings against the company, claiming **$23.0 million** in damages for alleged breach of contract, with the claim amount increased by **$0.7 million** in October 2023[277](index=277&type=chunk) - The company intends to vigorously defend against the allegations, with the matter moving into the discovery phase in March 2024[277](index=277&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=73&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales of equity securities or use of proceeds were reported during the period - No unregistered sales of equity securities or use of proceeds were reported[278](index=278&type=chunk) [Item 3. Defaults upon Senior Securities](index=73&type=section&id=Item%203.%20Defaults%20upon%20Senior%20Securities) The company reported no defaults upon senior securities - No defaults upon senior securities were reported[278](index=278&type=chunk) [Item 4. Mine Safety Disclosures](index=73&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Mine Safety Disclosures are not applicable to Bitcoin Depot Inc[278](index=278&type=chunk) [Item 5. Other Information](index=73&type=section&id=Item%205.%20Other%20Information) This section provides information on insider trading arrangements and policies - No directors or officers adopted or terminated a Rule 10b5-1 trading agreement or non-Rule 10b5-1 trading arrangement during the three months ended March 31, 2024[279](index=279&type=chunk) [Item 6. Exhibits and Financial Statement Schedules](index=74&type=section&id=Item%206.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists exhibits and financial statement schedules, including credit agreement amendments and certifications - The report includes Exhibit 10.1, Amendment No. 1 to the Amended and Restated Credit Agreement, and certifications from the Chief Executive Officer and Chief Financial Officer[281](index=281&type=chunk)[282](index=282&type=chunk) [SIGNATURES](index=75&type=section&id=SIGNATURES) This section contains the required signatures for the quarterly report, confirming submission by authorized officers - The report is signed by Brandon Mintz, President and Chief Executive Officer, and Glen Leibowitz, Chief Financial Officer, on May 15, 2024[285](index=285&type=chunk)

Bitcoin Depot Inc. (NASDAQ:BTM) Q1 2024 Earnings Conference Call May 14, 2024 10:00 AM ET Company Participants Alex Kovtun – Gateway Group, Inc. Brandon Mintz – Chief Executive Officer Glen Leibowitz – Chief Financial Officer Scott Buchanan – Chief Operating Officer Conference Call Participants Mike Colonnese – H.C. Wainwright Patrick McCann – Noble Capital Markets Harold Goetsch – B. Riley Securities Mike Grondahl – Northland Securities Michael Kupinski – Noble Capital Markets Operator Good morning, and w ...

| --- | --- | |------------------|-------------------| | | | | Company Overview | 图 ng | | | p8, v e2 i yli ci | Installed Kiosks in North America $4.9M Q1 2024 Adjusted EBITDA (3) 7.1K Currency in Circulation (U.S.) (3) +7% CAGR ($ Trillion) 1.70 1.80 2.10 2.20 2.30 2.34 2018 2019 2020 2021 2022 2023 11 Investor Presentation Q1 2024 This presentation is not intended for distribution to, or use by any person in, any jurisdiction where such distribution or use would be contrary to local law or regulation. Th ...

Strengthens Footprint with Over 2,000 New Retail Locations Signed in the First Quarter of 2024 Committed to Acquire Approximately 3,200 Additional Kiosks Year-to-Date to Support Expansion Strategy Gross Profit in the first quarter of 2024 was $14.4 million, down 26% from $19.5 million for the first quarter of 2023. Gross Profit margin in the first quarter of 2024 was 10.4% compared to 11.9% in the first quarter of 2023. Total operating expenses were $16.6 million for the first quarter of 2024, compared to $ ...

ATLANTA, May 06, 2024 (GLOBE NEWSWIRE) -- Bitcoin Depot (“Bitcoin Depot” or the “Company”), a U.S.-based Bitcoin ATM operator and leading fintech company, will hold a conference call and live audio webcast on Tuesday, May 14th at 10:00 a.m. Eastern time (7:00 a.m. Pacific Time) to discuss its financial results for the first quarter ended March 31, 2024. Bitcoin Depot plans to release results before the market open on the same day. Call Date: Tuesday, May 14, 2024 Time: 10:00 a.m. Eastern time (7:00 a.m. Pac ...

ATLANTA, May 06, 2024 (GLOBE NEWSWIRE) -- Bitcoin Depot (“Bitcoin Depot” or the “Company”), a U.S.-based Bitcoin ATM operator and leading fintech company, will hold a conference call and live audio webcast on Tuesday, May 14th at 10:00 a.m. Eastern time (7:00 a.m. Pacific Time) to discuss its financial results for the first quarter ended March 31, 2024. Bitcoin Depot plans to release results before the market open on the same day. Call Date: Tuesday, May 14, 2024   Time: 10:00 a.m. Eastern time (7:00 a.m. P ...

ATLANTA, April 25, 2024 (GLOBE NEWSWIRE) -- Bitcoin Depot ("Bitcoin Depot" or the "Company") (NASDAQ:BTM), a U.S.-based Bitcoin ATM ("BTM") operator and leading fintech company, today announced a strategic investment from Sopris Capital ("Sopris"), a 20-year-old multi-strategy investment firm. As part of the investment, Sopris Capital has purchased 2,906,976 Class A common shares and is now one of the Company`s largest independent shareholders. "We are thrilled to own part of a growing, market-leading busin ...

ATLANTA, April 18, 2024 (GLOBE NEWSWIRE) -- Bitcoin Depot ("Bitcoin Depot" or the "Company") (NASDAQ:BTM), a U.S.-based Bitcoin ATM ("BTM") operator and leading fintech company, today announced the purchase of approximately 2,300 Bitcoin ATMs. The Company plans to strategically deploy these kiosks as part of its ongoing expansion efforts throughout 2024 and beyond. The purchase of approximately 2,300 Bitcoin ATMs comes at a greater than 50% discount in cost per-kiosk compared to the Company's typical per-ki ...

Business Operations and Market Presence - Bitcoin Depot operates approximately 6,300 kiosks across 48 U.S. states and 10 Canadian provinces, covering 52% of the U.S. population[17] - The company has a 23% market share in the U.S. and 11% in Canada for Bitcoin ATMs (BTMs) as of December 31, 2023[30] - Bitcoin Depot installed approximately 1,300 BTMs in Circle K stores, its largest retail partner, as of December 31, 2023[18] - The company's BDCheckout product provides access to Bitcoin purchases at thousands of additional retailer locations without requiring kiosks[25] - BDCheckout is available at approximately 5,700 retail locations across North America as of December 31, 2023[44] - The company signed a master placement agreement with EG America LLC to install BTMs in approximately 900+ locations[47] - The company plans to expand into New York, estimating the market could support thousands of kiosks[41] - Approximately 92% of BTMs worldwide are in North America, presenting significant international expansion opportunities[41] Financial Performance - The company generated $689.0 million in revenue and $88.6 million in gross profit (12.9% gross profit margin) for the year ended December 31, 2023[16] - Bitcoin Depot's Adjusted EBITDA for 2023 was $56.3 million, representing a 14.7% Adjusted Gross Profit Margin[16] - Revenue for 2023 was $689.0 million, with gross profit of $88.6 million and adjusted gross profit of $101.0 million[42] - Circle K represents approximately 27% of total revenues for 2023, with contracts having a weighted average remaining life of 1.5 years[55] - The company's consolidated financial statements for the years ended December 31, 2023, and December 31, 2022, were audited and found to be in conformity with U.S. GAAP[409] Transaction and User Data - Bitcoin Depot completed over 3.3 million user transactions totaling approximately $2.3 billion from inception in July 2016 through December 31, 2023[16] - New users can purchase Bitcoin in under two minutes, while returning users complete transactions in under a minute[34] - Approximately 4% of transaction volumes are banned monthly due to compliance violations[36] - Bitcoin accounted for 99% of the company's total transaction volume for the year ended December 31, 2023, with other cryptocurrencies making up less than 1%[406] Compliance and Risk Management - The compliance team consists of 16 individuals with over 100 years of combined experience in AML, KYC, BSA, and OFAC compliance[36] - The company is subject to various anti-money laundering and counter-terrorist financing laws, including the BSA in the U.S. and similar laws in Canada[72] - The company's business is highly dependent on the adoption and market price of Bitcoin, which is subject to substantial volatility and influenced by factors such as technology, regulation, and market demand[406] - The company faces intense competition from traditional financial institutions, fintech companies, brokerage firms, and digital payment companies, both domestically and internationally[408] Kiosk and Technology Infrastructure - The company has approximately 900 BTMs ready for redeployment to new locations as of December 31, 2023[18] - The company's kiosks are primarily manufactured by Genmega, with extended functional life due to lower utilization compared to traditional ATMs[19] - Genmega has supplied over 7,200 kiosks to the company since 2016[57] - The company utilizes four major lessors to finance approximately 6,000 BTMs, with lease commitments to acquire all kiosks for a bargain purchase option at the end of the lease term as of December 31, 2023[61] Liquidity and Financial Partners - Cumberland DRW is one of the company's co-primary liquidity providers for Bitcoin purchases, with a relationship spanning over three years[56] - Abra is another co-primary liquidity provider for Bitcoin purchases, with a relationship of almost one year[56] - The average daily USD balance held in fiat wallets on the Gemini exchange was approximately $0.5 million for the year ended December 31, 2023[58] Currency and Market Risks - Currency exchange rate fluctuations had an insignificant impact on the company's consolidated revenues for the years ended December 31, 2023, and December 31, 2022[403] - The company's transaction gains and losses due to currency fluctuations were insignificant for the years ended December 31, 2023, and December 31, 2022[404] - The company's foreign currency translation adjustments are recorded as a component of other comprehensive income and included in stockholders' equity[405] - The company may hedge its foreign currency exposure in the future, although it has not historically done so[403] - The company's market risk disclosures provide forward-looking indicators of potential exposure to cryptocurrency price and interest rate fluctuations, though they are not precise predictors of future losses[402] Operational and Financial Risks - The cost of new kiosks can be significantly impacted by inflation, supply constraints, and labor shortages, potentially leading to higher prices than the company's fair value estimates[407] - The company holds typically less than $1 million in Bitcoin at any given time due to high transaction volumes and does not store Bitcoin in cold wallets[63] - The company has experienced seasonality in the 4th quarter of the calendar year in revenue and related cost of cryptocurrency, attributed to fewer business days due to public holidays[68] Corporate Structure and Employees - As of December 31, 2023, the company had 124 full-time employees, most of whom were in the U.S.[64] - The company's principal executive offices and headquarters are located in leased premises consisting of approximately 5,700 square feet in Atlanta, Georgia[67] Contracts and Partnerships - The company's contracts with its top 10 retail partners had a weighted average remaining life of 1.7 years as of December 31, 2023[21] - Circle K represents approximately 27% of total revenues for 2023, with contracts having a weighted average remaining life of 1.5 years[55]

ATLANTA, April 12, 2024 (GLOBE NEWSWIRE) -- Bitcoin Depot (NASDAQ:BTM), a U.S.-based Bitcoin ATM ("BTM") operator and leading fintech company, today announced an outside investment firm has committed a multi-million-dollar investment into 250 Bitcoin Depot BTM kiosks as part of the Company's profit share program. The BTMs, operated by Bitcoin Depot, will provide passive income to the investment fund by paying out a percentage of monthly profits from these 250 kiosks. In addition to the 250 BTMs included in ...