Katapult Holdings 2025 Q3 Earnings 44.3% Net Loss Reduction

Katapult Holdings (KPLT) reported mixed results for Q3 2025, with revenue growth outpacing expectations but continued net losses. The company narrowed its net loss by 44.3% year-over-year to $4.95 million, while revenue surged 22.8% to $74.04 million. Management tempered full-year guidance for adjusted EBITDA amid macroeconomic uncertainties, reflecting cautious optimism despite strong gross origination growth.

Revenue

Katapult’s total revenue rose to $74.04 million in Q3 2025, a 22.8% increase from $60.31 million in the prior year. Rental revenue, the company’s primary driver, accounted for $72.78 million, while other revenue streams, including ancillary services, contributed $1.27 million. This performance underscores the resilience of Katapult’s lease-to-own model, particularly in its core rental segment, which remains central to its operations.

Earnings/Net Income

The company’s net loss narrowed to $4.95 million, or $0.94 per share, compared to $8.89 million, or $2.05 per share, in Q3 2024. This 54.1% improvement in per-share losses highlights operational efficiencies and cost discipline, though Katapult remains unprofitable. The reduction in losses aligns with management’s focus on streamlining back-end processes and optimizing capital structure.

Post-Earnings Price Action Review

Following the earnings release, Katapult’s stock faced significant downward pressure, with a 5.97% decline on the latest trading day, a 43.80% drop over the past week, and a 54.05% slump month-to-date. The sharp sell-off reflects investor concerns about macroeconomic headwinds and the company’s ongoing profitability challenges, despite strong top-line growth and improved net losses.

CEO Commentary

CEO Orlando Zayas emphasized operational efficiency and customer retention as key growth drivers, stating, “Our focus on streamlining back-end processes has allowed us to maintain margins despite market volatility.” She acknowledged rising supply chain costs but highlighted strategic investments in AI-driven analytics to enhance product personalization. Leadership remains cautiously optimistic, with Zayas noting, “While macroeconomic uncertainties persist, our diversified portfolio positions us to capitalize on emerging opportunities in the fintech sector.” The CEO reiterated a commitment to long-term market positioning through strategic partnerships and R&D, underscoring, “Innovation is our North Star as we navigate a competitive landscape.”

Guidance

Katapult guided to Q4 2025 revenue of $75–80 million, reflecting 5–8% sequential growth, and expects full-year 2025 revenue to reach $290–300 million. The CEO stated, “We remain disciplined on CAPEX, targeting $15 million in Q4 to support cloud infrastructure upgrades.” Forward-looking EPS guidance was not provided, though management expressed confidence in narrowing the net loss to below -$4 million annually. Qualitative expectations included leveraging customer data insights to expand market share in digital banking solutions.

Additional News

Katapult secured a $65 million capital investment from Hawthorne Horizon Credit Fund, enabling the repayment of its term loan and investment in growth opportunities. The transaction, which includes convertible preferred stock, strengthens the company’s balance sheet and provides a stable foundation for expansion. New directors Philip K. Bartow III and Jeffrey Rubin joined the board, alongside President Derek Medlin, signaling a strategic shift in governance. Additionally, Katapult expanded its merchant ecosystem by adding Apple to its app marketplace, enhancing its appeal to non-prime consumers.

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