Katapult Delivers Continued Growth in the Third Quarter

Core Insights - Katapult Holdings, Inc. reported a 25% year-over-year growth in gross originations for Q3 2025, marking the third consecutive year of growth, driven by increased application activity and a growing customer base [2][4][9] - The company secured a significant investment of $65 million from Hawthorn Horizon Credit Fund, which is expected to strengthen its balance sheet and support growth initiatives [3][8] - The company anticipates continued growth in gross originations and revenue for Q4 2025, despite macroeconomic challenges [10][14] Financial Performance - Gross originations reached $64.2 million in Q3 2025, a 25.3% increase from the previous year, with a notable 50% growth when excluding the home furnishings and mattress category [4][29] - Total revenue for Q3 2025 was $74.0 million, reflecting a 22.8% increase year-over-year [4][29] - The net loss for Q3 2025 was $4.9 million, an improvement from a net loss of $8.9 million in Q3 2024, primarily due to reduced litigation settlement expenses and compensation costs [5][29] Customer Engagement and Marketplace Activity - Total applications grew approximately 80% year-over-year, with 61% of gross originations originating from the Katapult app marketplace, which saw a 44% increase in gross originations [4][8] - The KPay conversion rate increased, leading to a 76% year-over-year growth in unique KPay customers, with KPay gross originations growing approximately 66% [4][8] - Customer satisfaction remained high, with a Net Promoter Score of 64 as of September 30, 2025 [4] Future Outlook - For Q4 2025, the company expects gross originations to grow between 15% and 20% year-over-year and revenue to increase by 21% to 23% [9][14] - Adjusted EBITDA is projected to be between $8 million and $9 million for the full year 2025, reflecting a more conservative outlook due to macroeconomic headwinds [10][14] - The company aims to leverage its improved capital structure and technology to capitalize on long-term growth opportunities in the underserved non-prime consumer market [10][14]