Core Insights - Alkami Technology, Inc. is hosting a webinar focused on layered security strategies for financial institutions to combat evolving fraud threats [1][2] - The discussion will feature leaders from Alkami and ORNL Federal Credit Union, emphasizing the importance of a multi-layered defense approach in modern digital banking [2] - The webinar is scheduled for October 29, 2025, at 12:00 p.m. EDT, aiming to provide practical strategies for enhancing security across various channels [2][3] Company Overview - Alkami provides a digital sales and service platform tailored for U.S. banks and credit unions, integrating onboarding, digital banking, and data marketing solutions [3] - The company has received recognition from J.D. Power for its outstanding mobile banking platform experience in 2024 and 2025 [3][4] - Alkami's platform aims to support financial institutions in adapting to the future of banking through technology that enhances user experience while maintaining security and compliance [3] Industry Context - The financial sector is facing increasingly sophisticated fraud tactics, necessitating a proactive and layered security approach to protect against threats such as synthetic identities and phishing [2][5] - The need for financial institutions to identify threats at every stage of customer interaction, from onboarding to transaction monitoring, is highlighted as essential for effective fraud prevention [2]

Financial Data and Key Metrics Changes - In Q4 2024, Alkami reported a revenue growth of 26% and generated over $10 million in adjusted EBITDA [8][30] - For the full year 2024, total revenue reached $333.8 million, also reflecting a 26% year-over-year growth, with adjusted EBITDA improving to $26.9 million from a loss of $1.6 million in 2023 [30][44] - The adjusted EBITDA margin for Q4 was 11.3%, achieving the Rule of 37 [42] Business Line Data and Key Metrics Changes - Subscription revenue grew by 26.5% in 2024, accounting for nearly 96% of total revenue [30] - The annual recurring revenue (ARR) increased by 22%, ending the quarter at $356 million [32] - Add-on sales represented 45% of new bookings in 2024, up from 24% in 2021 [12] Market Data and Key Metrics Changes - Alkami ended 2024 with 272 clients and 20 million registered users, marking a user growth of approximately 2.5 million or 14% compared to the previous year [33] - The company churned less than 1% of its digital banking ARR in 2024, with expectations of maintaining a churn rate of 2% to 3% per year in the long term [34] Company Strategy and Development Direction - Alkami aims to solidify its position as a premier digital banking platform through the acquisition of MANTL, which enhances its onboarding and account opening capabilities [22][45] - The company is focused on expanding its market share in both the bank and credit union sectors, with a long-term goal of generating half of its new logo wins from each market [11][19] - Alkami's strategy includes leveraging add-on sales and improving operational efficiency through platform investments [10][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's momentum heading into 2025, with expectations of continued growth and improved profitability [29][51] - The acquisition of MANTL is anticipated to be accretive to adjusted EBITDA starting in 2026, with an expected internal rate of return (IRR) of about 30% [48][50] - Management highlighted the competitive pressure from megabanks and fintechs, emphasizing the need for improved digital offerings among community banks and credit unions [19][20] Other Important Information - Alkami's gross margin for Q4 2024 was reported at 63.1%, with a target of reaching 65% by 2026 [39][114] - The company ended the quarter with nearly $116 million in cash and marketable securities, and produced operating cash flow of $18.6 million, an improvement of $36.1 million compared to 2023 [43][44] - Alkami announced an amendment to its credit facility, expanding its revolver from $125 million to $225 million [45] Q&A Session Summary Question: How does MANTL compare with existing account opening solutions? - Management noted that MANTL offers a comprehensive solution that supports various account types and channels, addressing gaps in Alkami's current offerings [56][58] Question: What is embedded in the 2025 outlook regarding user growth and ARPU expansion? - Management expects organic user growth in the 14% to 15% range and ARPU expansion of 6% to 8% for 2025, with MANTL's client base contributing additional users at a lower ARPU [60][63] Question: What is the competitive environment for MANTL? - Management indicated that MANTL faces competition from outdated core providers and smaller players, but its superior user experience and integration capabilities set it apart [70][72] Question: Will MANTL's EBITDA loss include any expense synergies? - Management clarified that while MANTL is expected to be EBITDA accretive in 2026, the focus will be on revenue synergies rather than immediate cost-cutting [73][100] Question: How will cross-selling opportunities be impacted? - Management expressed confidence in cross-selling opportunities between Alkami and MANTL's client bases, given their complementary nature [108][110] Question: What is the long-term margin trajectory for gross profit margin? - Management reiterated a target of 65% gross margin by 2026, with MANTL expected to contribute positively to this margin [114]

Financial Data and Key Metrics Changes - In Q4 2024, Alkami reported a revenue growth of 26% and generated over $10 million in adjusted EBITDA [8][30] - For the full year 2024, total revenue reached $333.8 million, also reflecting a 26% year-over-year growth, with adjusted EBITDA improving to $26.9 million from a loss of $1.6 million in 2023 [30][44] - The adjusted EBITDA margin for Q4 was 11.3%, achieving the Rule of 37, and the company ended the quarter with a cash and marketable securities balance of just under $116 million [42][44] Business Line Data and Key Metrics Changes - Subscription revenue grew by 26.5% in 2024, accounting for nearly 96% of total revenue [31] - The annual recurring revenue (ARR) increased by 22%, reaching $356 million, with approximately $56.5 million of ARR in backlog for implementation [32] - The revenue per user (RPU) increased by 7% to $17.81, driven by successful add-on sales [35] Market Data and Key Metrics Changes - Alkami ended 2024 with 272 clients and 20 million registered users, marking a growth of approximately 2.5 million users or 14% compared to the previous year [33] - The company churned less than 1% of its digital banking ARR in 2024, with expectations to maintain a churn rate of 2% to 3% per year in the long term [34] Company Strategy and Development Direction - Alkami's strategy includes a five-point plan focusing on success in the bank market, leveraging add-on sales, investing in platform efficiency, attracting talent, and pursuing acquisitions [10] - The acquisition of MANTL is expected to enhance Alkami's position as a premier digital banking platform, providing a comprehensive onboarding and account opening solution [22][45] - The company aims to generate half of its new logo wins from the bank market and half from the credit union market, with a focus on cross-selling opportunities post-acquisition [12][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's momentum heading into 2025, with guidance for Q1 2025 revenue between $93.5 million and $95 million, representing a growth of 23% to 25% [49] - For the full year 2025, revenue guidance is set between $440 million and $445 million, indicating a growth of 32% to 33% [50] - The management highlighted the importance of improving account opening experiences for financial institutions to remain competitive against larger banks and fintechs [19][20] Other Important Information - Alkami's gross margin for Q4 2024 was 63.1%, with expectations to reach 65% by 2026 [39][114] - The company has expanded its credit facility from $125 million to $225 million, extending the maturity date to February 2030 [45] Q&A Session Summary Question: How does MANTL compare with your existing account opening solutions? - The current offering is digital-only for limited deposit types, while MANTL provides a comprehensive solution across various channels and account types [56][58] Question: What is embedded in the 2025 outlook between user growth and ARPU expansion? - Organic user growth is expected in the 14% to 15% range, with ARPU expansion projected at 6% to 8% [60][61] Question: What is the competitive environment for MANTL? - MANTL faces competition from outdated core providers and smaller players, but its technology offers superior user experience and integration capabilities [70][72] Question: What are the prospects for MANTL's EBITDA to go from negative to positive? - The transition to positive EBITDA is primarily driven by revenue scale and leveraging Alkami's resources for growth [96][98] Question: How will cross-selling opportunities look post-acquisition? - Both companies have similar client bases, allowing for effective cross-selling of products and services [108][110] Question: What is the long-term margin trajectory for gross profit margin? - Alkami aims for a gross margin of 65% by 2026, with MANTL expected to contribute positively to this margin [114]