Bakkt, Inc. Q1 2026 10-Q Summary
Business Context and Reporting Period
This Quarterly Report on Form 10-Q covers the three-month period ended March 31, 2026. Bakkt, Inc. (formerly Bakkt Holdings, Inc.) operates as a pure-play digital asset infrastructure platform, providing trading, custody, and stablecoin payment solutions. The company recently completed a strategic transformation, divesting its loyalty business in late 2025 and focusing on three core solutions: Bakkt Markets, Bakkt Agent, and Bakkt Global. As of the reporting date, the company holds a New York State BitLicense and money transmitter licenses in 46 U.S. states.
Key Financial Metrics
| Metric (in thousands, except per share) | Q1 2026 | Q1 2025 |
|---|---|---|
| Crypto Services Revenue | $243,593 | $1,065,756 |
| Total Operating Expenses | $260,517 | $1,081,193 |
| Operating Loss | $(16,924) | $(15,437) |
| Net Loss (Attributable to Bakkt) | $(11,650) | $7,710 (Net Income) |
| Diluted EPS | $(0.41) | $1.13 |
| Cash and Cash Equivalents | $79,984 | $23,010 |
| Restricted Cash | $2,576 | $19,754 |
| Accumulated Deficit | $(916,822) | $(790,250) |
Liquidity & Capital: The company raised approximately $67.1 million in net proceeds during Q1 2026 through a Registered Direct Offering (RDO) and At-The-Market (ATM) offerings. Management believes current cash resources are sufficient to fund operations for the next 12 months.
Material Changes vs. Prior Period
- Revenue Decline: Crypto services revenue decreased by 77.1% ($822.2 million) compared to Q1 2025. This was primarily driven by a significant reduction in trading volume following the departure of major clients Webull and Public Platform LLC.
- Expense Reduction: Total operating expenses decreased by 76.0% ($820.7 million), largely due to a proportional drop in "Crypto costs" (cost of goods sold) which fell $814.7 million. Operating expenses excluding crypto costs also saw reductions in compensation and SG&A.
- Profitability Shift: The company reported a net loss of $11.7 million in Q1 2026, compared to a net income of $7.7 million in Q1 2025. The prior year's income was significantly boosted by a $32.2 million non-cash gain from the change in fair value of warrant liabilities, compared to a $4.7 million gain in the current quarter.
- Balance Sheet: Cash and cash equivalents increased from $23.0 million to $80.0 million due to equity financing. Customer funds payable increased slightly to $17.4 million.
Guidance, Outlook, and Risks
Management Commentary & Strategy: Management is executing a strategy to transition from a high-volume, low-margin trading model to a diversified infrastructure platform. Key initiatives include the integration of Distributed Technologies Research Global Ltd. (DTR) to enhance stablecoin payment capabilities and the launch of peer-to-peer fiat transfer functionality on the Bakkt Markets platform.
Recent Developments:
- DTR Acquisition: Closed on April 30, 2026 (subsequent to period end). The company issued approximately 11.3 million shares of Class A Common Stock as consideration.
- Product Launches: Activated P2P fiat transfers and ACH push/wire rails in April 2026.
Risks & Contingencies:
- Client Concentration: The loss of Webull (approx. 40% of 2025 revenue) and Public (approx. 17% of 2025 revenue) created significant revenue volatility. Management is actively pursuing new clients to mitigate this.
- Legal Proceedings: The company is engaged in litigation with Project Labrador Holdco, LLC ("Roman") regarding the sale of the Loyalty business. Bakkt is seeking ~$10 million; Roman has filed counterclaims for ~$19 million. Additionally, a putative class action lawsuit regarding disclosures related to the Webull non-renewal remains pending.
- Regulatory Environment: The company faces evolving regulations regarding digital assets, stablecoins, and the GENIUS Act. Compliance costs and licensing requirements remain a key operational factor.
- Going Concern: While management asserts sufficient liquidity for 12 months, the company has a history of losses and an accumulated deficit of $916.8 million. Future profitability depends on successful revenue growth and cost optimization.
Investor Verification Checklist
- Client Diversification: Verify the status of new client onboarding and the specific revenue contribution of new partners to offset the loss of Webull and Public.
- DTR Integration: Monitor the progress of integrating DTR's stablecoin technology and the timeline for revenue recognition from this acquisition.
- Litigation Exposure: Track the status of the lawsuit against Roman and the class action regarding Webull disclosures, as outcomes could result in significant financial liabilities.
- Cash Burn Rate: Assess the sustainability of the current cash position ($80M) against the operating loss trajectory and the timeline to profitability.
- Warrant Liability: Note that a significant portion of the Q1 2025 income was non-cash warrant gains; future earnings will be more sensitive to stock price volatility affecting warrant valuations.