Why Is Green Dot (GDOT) Up 8.6% Since Last Earnings Report?

Core Viewpoint - Green Dot Corporation has shown strong performance in its recent earnings report, with significant growth in earnings and revenues, leading to positive investor sentiment and stock performance [3][9]. Financial Performance - Green Dot reported Q2 2025 earnings per share of 40 cents, exceeding the Zacks Consensus Estimate by over 100% and improving 60% year-over-year [3]. - Revenues reached $501.2 million, beating the Zacks Consensus Estimate by 1.1% and increasing 23.1% year-over-year [3]. - Adjusted EBITDA totaled $45.43 million, a 34% increase year-over-year, although the adjusted EBITDA margin decreased by 70 basis points to 9.1% [7]. Segment Analysis - B2B Services revenues grew by 38.3% to $348.7 million, driven by a BaaS partner and stability in the BaaS portfolio [4]. - Money Movement Services revenues declined by 4% to $50.85 million, affected by a slight dip in Money Processing, despite growth in Tax Processing [4]. - Consumer Services revenues were $93.1 million, down 3.64% year-over-year, primarily due to challenges in the Retail channel, partially offset by the launch of PLS [5]. Key Metrics - Gross dollar volume increased by 20% year-over-year to $38.55 billion, while purchase volume fell by 0.4% to $4.99 billion [6]. - Active accounts rose by 2.1% year-over-year to 3.48 million [6]. Balance Sheet and Cash Flow - Green Dot ended Q2 with $2.3 billion in unrestricted cash and cash equivalents, up from $1.59 billion at the end of Q4 2024, and had no long-term debt [8]. - The company generated $177.7 million in cash from operating activities, with capital expenditures of $109.3 million [8]. Guidance - For 2025, Green Dot expects total operating revenues between $2 billion and $2.1 billion, with adjusted earnings per share guidance of $1.28-$1.42, up from the previous range of $1.14-$1.28 [9]. - Adjusted EBITDA is anticipated to be between $160 million and $170 million, an increase from the prior guidance of $150 million to $160 million [9]. Market Position - Green Dot holds a Zacks Rank 1 (Strong Buy), indicating expectations for above-average returns in the coming months [13]. - In comparison, Western Union, a competitor in the Financial Transaction Services industry, reported a revenue decline of 3.8% year-over-year, highlighting Green Dot's stronger performance [14].