Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________ Commission File Number: 001-41305 Bitcoin Depot Inc. (Exact name of registrant as specified in its charter) Delawar ...

Financial Performance - Q1 2025 revenue increased by 19% year-over-year to $164.2 million, up from $138.5 million in Q1 2024[3] - Q1 2025 net income rose significantly to $12.2 million, compared to a net loss of $4.2 million in Q1 2024[5] - Adjusted gross profit for Q1 2025 increased by 92% to $33.1 million, with an adjusted gross profit margin of 20.2%, up from 12.5% in Q1 2024[6] - Adjusted EBITDA for Q1 2025 surged by 315% to $20.3 million, compared to $4.9 million in Q1 2024[7] - Revenue increased to $164,226,000 in Q1 2025, up 18.5% from $138,539,000 in Q1 2024[33] - Adjusted EBITDA for Q1 2025 was $20,293,000, representing an Adjusted EBITDA margin of 12.4%, compared to $4,885,000 and 3.5% in Q1 2024[31] - Adjusted Gross Profit for Q1 2025 was $33,135,000, with an Adjusted Gross Profit margin of 20.2%, up from $17,252,000 and 12.5% in Q1 2024[33] - The company reported a gross profit of $31,244,000 for Q1 2025, compared to $14,371,000 in Q1 2024[33] Cash Flow and Operations - Cash from operations in Q1 2025 was $16.3 million, significantly up from $1.3 million in Q1 2024[9] - As of March 31, 2025, cash, cash equivalents, and cryptocurrencies totaled $43.3 million, an increase from $31.0 million at the end of 2024[8] - Cash and cash equivalents at the end of Q1 2025 were $34,962,000, down from $42,151,000 at the end of Q1 2024[25] - The company acquired $7,824,000 in Bitcoin for investment during Q1 2025[25] Expenses and Liabilities - Total operating expenses decreased by 7% to $15.3 million in Q1 2025, down from $16.6 million in Q1 2024[4] - Total current liabilities increased to $41,932,000 as of March 31, 2025, compared to $40,629,000 at the end of 2024[23] - Total liabilities decreased slightly to $94,311,000 as of March 31, 2025, from $96,590,000 at the end of 2024[23] - The accumulated deficit decreased to $39,304,000 as of March 31, 2025, from $44,349,000 at the end of 2024[23] Market Position and Future Outlook - The company operates over 8,400 kiosk locations across 48 states, maintaining the largest market share in North America[13] - The company expects revenue growth in Q2 2025 to be in the low-to-mid-single digits percentage range compared to Q2 2024[10] - Bitcoin Depot increased its bitcoin holdings by acquiring 83 more BTC in Q1 2025, bringing the total to 94.35 BTC[8]

Financial Performance - As of December 31, 2024, the company generated approximately $573.7 million in revenue, a decrease from $689.0 million in 2023, with a net income of $7.8 million and Adjusted EBITDA of $39.7 million, representing a 15.9% Adjusted Gross Profit Margin [29]. - Revenue for the years ended December 31, 2024 and 2023 was approximately $573.7 million and $689.0 million, respectively, with gross profit of $81.5 million and $88.6 million [59]. - The company has generated positive net income and cash flow from operations every year since inception, indicating strong financial health [59]. User Engagement and Market Presence - The company completed over 3.7 million user transactions since inception, totaling approximately $2.8 billion in transaction value, with an average of 14,961 monthly active users in 2024 [29]. - The company operates approximately 8,500 kiosks across 48 U.S. states, 10 Canadian provinces, and Puerto Rico, with a market share of 25% in the U.S. and 8% in Canada as of December 31, 2024 [50][44]. - The company has installed kiosks in approximately 1,100 out of over 9,000 total Circle K locations in the U.S. and Canada, representing a significant market presence [58]. - As of December 31, 2024, BDCheckout is available at approximately 7,600 retail locations across North America, enhancing user access to Bitcoin purchases [61]. Cryptocurrency Market Dynamics - In 2024, Bitcoin was reported as the largest payment network with over $19 trillion in transaction volume, surpassing Visa and Mastercard [42]. - Bitcoin represents 99% of total transaction volume for the year ended December 31, 2024, indicating heavy reliance on this cryptocurrency [502]. Global Expansion and Deployment - The total number of BTMs deployed globally grew from approximately 1,000 to 38,000 from January 1, 2017, to December 31, 2024, representing a CAGR of approximately 46% [44]. - Approximately 90% of installed BTMs worldwide are located in the U.S. and Canada, highlighting the significant market opportunity for the company [44]. - The company has entered into a master placement agreement with EG America LLC to install BTMs in approximately 900+ locations, marking a significant expansion [66]. - Approximately 90% of BTMs worldwide are located in North America, presenting an opportunity for international expansion [58]. Compliance and Regulatory Environment - The compliance team consists of 20 individuals with over 100 years of combined experience in regulatory compliance, ensuring robust KYC processes [53]. - User bans due to compliance issues represent approximately 4% of overall transaction volumes in a given month, reflecting the company's commitment to compliance [54]. - The company operates in a complex regulatory environment across the U.S., Puerto Rico, Canada, and Australia, with a heightened focus on cryptocurrency regulation [96]. - The company has implemented a compliance program to prevent its kiosks from being used for money laundering and terrorist financing [99]. - The company is not currently supervised by any banking, securities, or commodities regulator, but closely monitors regulatory changes [96][98]. Legal and Competitive Landscape - Legal proceedings against the company include a claim for $23 million in damages related to a breach of contract with Canaccord Genuity Corp [120]. - The total transaction value in the Canaccord claim is estimated to be up to $655 million following a merger [121]. - The company faces a civil complaint from the Iowa Attorney General alleging violations of the Iowa Consumer Fraud Act [123]. - The competitive landscape is intensifying with both traditional financial institutions and fintech companies entering the cryptocurrency market [504]. Operational Challenges - Equipment costs for new kiosks may increase significantly due to inflation, supply constraints, and labor shortages [503]. - The company has successfully managed inflationary cost increases through pricing, productivity, and cost-cutting initiatives [94]. Strategic Initiatives - The company plans to pursue strategic acquisitions to enhance capabilities in areas such as cyber security and compliance, supporting growth strategies [60]. - The company has lease commitments to acquire all kiosks for a bargain purchase option at the end of the lease term, financing approximately 3,500 BTMs [86][87]. - The company has a weighted average remaining life of 1.8 years for contracts with its top 10 retail partners, which typically have an initial term of about five years [36]. Financial Partnerships - Circle K represents approximately 23% and 27% of total revenues for the years ended December 31, 2024 and 2023, respectively, highlighting the importance of this partnership [78]. - As of December 31, 2024, the average daily USD balance held in fiat wallets on the Gemini exchange was approximately $0.5 million [83].

Revenue Performance - Q4 2024 revenue was $136.8 million, down 7.5% from $148.4 million in Q4 2023[1][4] - Full year 2024 revenue was $573.7 million, down from $689.0 million in 2023, primarily due to unfavorable legislation in California[1][8] - Total revenue for the year ended December 31, 2024, was $573,703,000, a decrease of 16.7% compared to $688,967,000 in 2023[37] - For the three months ended December 31, 2024, revenue was $136,827,000, a decrease of 7.8% from $148,406,000 in the same period of 2023[37] Profitability - Q4 2024 net income increased significantly to $5.4 million, compared to a net loss of $1.7 million in Q4 2023, marking a turnaround[1][5] - Full year 2024 net income increased by 432% to $7.8 million compared to $1.5 million in 2023[1][9] - Net income for the year ended December 31, 2024, was $7.8 million, compared to a net income of $1.5 million in 2023, representing a significant improvement[26] - The company reported a loss attributable to Bitcoin Depot Inc. of $11.7 million for the year ended December 31, 2024, compared to a loss of $26.1 million in 2023[26] Operating Expenses - Q4 2024 operating expenses decreased by 16% to $15.0 million compared to $17.8 million in Q4 2023[1][5] - Operating expenses for the year ended December 31, 2024, totaled $67.2 million, a slight decrease from $70.6 million in 2023[26] Adjusted Metrics - Adjusted gross profit for Q4 2024 rose 18% to $25.4 million, with an adjusted gross profit margin of 18.6%, up from 14.5% in Q4 2023[1][6] - Adjusted EBITDA for Q4 2024 increased by 34% to $12.0 million compared to $9.0 million in Q4 2023[1][7] - Adjusted EBITDA for the year ended December 31, 2024, was $38.7 million, down from $56.3 million in 2023, with an Adjusted EBITDA margin of 6.8%[33] - Adjusted gross profit for the year ended December 31, 2024, was $91,440,000, with an adjusted gross profit margin of 15.9%, up from 14.7% in 2023[37] - Adjusted gross profit for the three months ended December 31, 2024, was $25,412,000, with an adjusted gross profit margin of 19%, up from 15% in the same quarter of 2023[37] Future Projections - The company anticipates Q1 2025 revenues between $151 million and $154 million, representing growth of 9% to 11% compared to Q1 2024[1][13] - Projected adjusted EBITDA for Q1 2025 is expected to be between $12 million and $14 million, indicating growth of over 200% compared to Q1 2024[1][13] Financial Position - Total liabilities increased to $96.6 million as of December 31, 2024, from $65.0 million in 2023, reflecting a rise of 48.0%[24] - The accumulated deficit grew to $44.3 million in 2024, compared to $32.7 million in 2023, indicating a worsening financial position[24] - Cash and cash equivalents at the end of 2024 were not disclosed, but the increase in liabilities suggests potential liquidity concerns[24] Strategic Focus - The company plans to focus on strategic initiatives to improve profitability and reduce costs in the upcoming year[27] - Future projections for revenue growth and market expansion were not explicitly detailed, but management emphasized the importance of operational efficiency[28] Bitcoin Holdings - Bitcoin Depot has increased its Bitcoin treasury holdings to 94 BTC, reflecting confidence in Bitcoin as a financial asset[1][3]

Business Operations - As of September 30, 2024, Bitcoin Depot operates approximately 8,304 Bitcoin ATMs (BTMs) across North America, maintaining a leading position in the cash-to-Bitcoin BTM market [264]. - Bitcoin Depot has installed its BTMs in approximately 1,200 Circle K stores, making it the exclusive provider for this convenience store chain in the U.S. and Canada [266]. - The number of BDCheckout locations increased to 7,723 as of September 30, 2024, reflecting growth in the company's service offerings [277]. - The company activated approximately 1,000 additional kiosks in the second quarter of 2024, following the reinstallation of kiosks during the optimization plan [295]. - The company currently supports Bitcoin sales at only 34 kiosks, representing less than 1.0% of total kiosks, with no plans for expansion in this area [287]. Financial Performance - Revenue for the nine months ended September 30, 2024, was $436.9 million, a decline of 15.2% compared to $540.6 million for the same period in 2023, despite Bitcoin's market price increasing by 127% [267]. - Revenue decreased by $103.7 million, or 19.2%, for the nine months ended September 30, 2024, compared to the same period in 2023, primarily due to decreases in kiosk transaction revenue and regulatory changes in California [309]. - Revenue for the three months ended September 30, 2024, was $135.3 million, a decrease of 24.6% compared to $179.5 million for the same period in 2023 [336]. - Adjusted Gross Profit for the nine months ended September 30, 2024, was $66.0 million, down 16.9% from $79.5 million in the same period of 2023 [336]. - The Adjusted EBITDA for the three months ended September 30, 2024, was $9.2 million, with an Adjusted EBITDA margin of 6.8% [339]. User Engagement - The median kiosk transaction size increased to $250 for the three months ended September 30, 2024, up from $230 in the previous quarter [277]. - The number of returning user transactions averaged 7.3 for the twelve months following their initial transaction as of September 30, 2024, indicating user retention [279]. - Approximately 99.9% of the company's total transaction volume was attributable to transactions in Bitcoin, which accounted for 100% of transaction volumes as of the reporting date [331]. Revenue and Cost Trends - Kiosk transaction revenue decreased by $43.8 million, or 24.5%, for the three months ended September 30, 2024, attributed to a decrease in the number of users and transaction volume [297]. - Cost of revenue (excluding depreciation and amortization) decreased by $39.7 million, or 26.0%, for the three months ended September 30, 2024, due to a decrease in transactions and regulatory changes in California [300]. - Cryptocurrency expenses decreased by $41.3 million, or 29.7%, for the three months ended September 30, 2024, primarily due to lower transaction volume [302]. - Selling, general and administrative expenses decreased by $1.5 million, or 9.5%, for the three months ended September 30, 2024, driven by lower professional fees [306]. - Operating expenses increased by $0.8 million, or 1.9%, for the nine months ended September 30, 2024, primarily due to higher payroll costs from an increase in headcount [324]. Regulatory Impact - Regulatory changes in California, effective January 1, 2024, impose a daily limit of $1,000 on transactions at crypto kiosks, which may negatively impact revenue in that state [274]. Cash and Debt Management - The company held approximately $0.7 million of Bitcoin as part of its treasury strategy as of September 30, 2024 [270]. - As of September 30, 2024, the company had negative working capital of approximately $(4.3) million, with cash and cash equivalents of approximately $41.4 million [329]. - The company refinanced $20.8 million of its credit agreement with an annual interest rate of 17%, requiring monthly interest payments and fixed principal payments every six months [342]. - The company entered into an amendment to its credit agreement on March 26, 2024, providing an additional $15.7 million in principal financing, increasing the total term loan facility to $35.6 million [344]. Net Income and Loss - Net income attributable to Bitcoin Depot Inc. was a loss of $5.0 million for the nine months ended September 30, 2024, compared to a loss of $17.8 million in the same period in 2023, reflecting a decrease of 71.7% [308]. - For the nine months ended September 30, 2024, Bitcoin Depot Inc. reported a net loss of approximately $2.4 million, with losses allocated from BT HoldCo [328]. Market Risks and Accounting Changes - The Company is exposed to market risk from changes in foreign currency exchange rates and interest rates, managed through normal operating and financing activities [364]. - The Company adopted ASU 2021-08 effective January 1, 2023, with no impact on the consolidated financial statements [357]. - The Company is still assessing the impacts of ASU 2023-06 and ASU 2023-09 on its consolidated financial statements [361][362].

Revenue Performance - Revenue for Q3 2024 was $135.3 million, a decrease of 25% from $179.5 million in Q3 2023, primarily due to unfavorable legislation in California and the relocation of underperforming kiosks[4] - Revenue for the three months ended September 30, 2024, was $135,271 thousand, a decrease of 24.6% compared to $179,483 thousand for the same period in 2023[23] Operating Expenses - Total operating expenses decreased by 13% to $16.9 million in Q3 2024, compared to $19.5 million in Q3 2023, attributed to non-recurring costs from going public in 2023[5] - Total operating expenses for the three months ended September 30, 2024, were $16,939 thousand, a decrease of 13.1% from $19,502 thousand in the same period of 2023[23] Net Income and Loss - Net income for Q3 2024 increased by 116% to $2.3 million, up from $1.1 million in Q3 2023, driven by lower operating expenses[5] - Net income for the three months ended September 30, 2024, was $2,299 thousand, compared to $1,065 thousand for the same period in 2023, representing a 116.1% increase[23] - The net loss attributable to Bitcoin Depot Inc. for the three months ended September 30, 2024, was $(939) thousand, compared to a net loss of $(7,098) thousand for the same period in 2023[23] - The company reported a comprehensive loss attributable to Bitcoin Depot Inc. of $(945) thousand for the three months ended September 30, 2024, compared to $(7,098) thousand for the same period in 2023[23] Adjusted Metrics - Adjusted gross profit for Q3 2024 was $22.4 million, down 17% from $26.9 million in Q3 2023, while adjusted gross profit margin improved to 16.6% from 15.0%[6] - Adjusted Gross Profit for the three months ended September 30, 2024, was $22,418 thousand, down from $26,938 thousand in the same period of 2023, resulting in an Adjusted Gross Profit margin of 16.6%[33] - Adjusted EBITDA decreased by 34% to $9.2 million in Q3 2024, compared to $13.9 million in Q3 2023, due to lower revenue[7] - Adjusted EBITDA for the three months ended September 30, 2024, was $9,182 thousand, with an Adjusted EBITDA margin of 6.8%, compared to $13,948 thousand and 7.8% for the same period in 2023[29] Cash and Assets - Cash and cash equivalents were $32.2 million at the end of Q3 2024, with cash flows from operations generating $5.8 million in Q3 2024, down from $7.0 million in Q3 2023[8] - Total assets increased to $87.4 million as of September 30, 2024, compared to $77.4 million at the end of 2023[18] - Total liabilities rose to $95.3 million as of September 30, 2024, up from $68.0 million at the end of 2023[20] Business Expansion and Strategy - The company ended Q3 2024 with 8,300 Bitcoin ATMs, exceeding its expansion goals and enhancing Bitcoin's accessibility[2] - The company plans to initiate cash dividends to common shareholders in 2025 as part of its strategy to create shareholder value[3] Other Expenses - The total other expense for the three months ended September 30, 2024, was $(2,833) thousand, a decrease from $(6,034) thousand in the same period of 2023[23] - The company recognized a non-cash expense of $2.7 million related to the PIPE transaction for the three months ended September 30, 2023[29] - The cost of revenue (excluding depreciation and amortization) for the three months ended September 30, 2024, was $112,853 thousand, down 26.0% from $152,545 thousand in the same period of 2023[33]

Operations and Locations - As of June 30, 2024, Bitcoin Depot operates approximately 8,068 Bitcoin ATMs (BTMs) across North America, with 7,441 retail locations accepting the BDCheckout product[259]. - Bitcoin Depot's largest BTM deployment is with Circle K, with approximately 1,200 BTMs installed in their stores as of June 30, 2024[261]. - The number of BDCheckout locations increased to 7,441 as of June 30, 2024, compared to 5,195 in the same period of 2023[270]. - The company activated approximately 1,000 additional kiosks during the three months ended June 30, 2024, following the reinstallation of kiosks in early 2024[289]. - The company had no open purchase orders for kiosks as of June 30, 2024[346]. Financial Performance - Revenue for the six months ended June 30, 2024, was $301.6 million, representing an 8.2% decline compared to $361.1 million for the same period in 2023, despite Bitcoin's market price increasing by 105%[262]. - Revenue decreased by $34.4 million, or 17.4%, for the three months ended June 30, 2024, compared to the same period in 2023, primarily due to decreases in kiosk transaction revenue[289]. - Revenue decreased by $59.5 million, or 16.5%, for the six months ended June 30, 2024, compared to the same period in 2023, primarily due to a decrease in kiosk transaction revenue[304]. - The company reported revenue of $163.1 million for the three months ended June 30, 2024, down from $197.5 million in the same period of 2023[331]. - Adjusted Gross Profit for the six months ended June 30, 2024, was approximately $43.6 million, compared to $52.5 million for the same period in 2023[331]. - Adjusted EBITDA for the three months ended June 30, 2024, was $12.7 million, compared to $19.8 million in the same period of 2023[335]. Transaction Metrics - The median kiosk transaction size increased to $230 for the three months ended June 30, 2024, up from $200 in the same period of 2023[270]. - The average returning user transaction count decreased to 7.1 for the twelve months ending June 30, 2024, down from 9.2 in the same period of 2023[272]. - Approximately 99.9% of total transaction volume was attributable to Bitcoin transactions, which accounted for 100% of transaction volumes as of the report date[326]. Revenue and Cost Changes - Kiosk transaction revenue decreased by $34.6 million, or 17.6%, for the three months ended June 30, 2024, attributed to a decrease in the number of users and transaction volume, with California's daily transaction limits accounting for approximately 50% of the revenue decline[291]. - Cost of revenue (excluding depreciation and amortization) decreased by $30.5 million, or 18.3%, for the three months ended June 30, 2024, primarily due to a decrease in transaction volume and regulatory changes in California[295]. - Cryptocurrency expenses decreased by $31.4 million, or 20.5%, for the three months ended June 30, 2024, compared to the same period in 2023, mainly due to lower transaction volume[297]. - Selling, general and administrative expenses increased by $2.4 million, or 8.8%, for the six months ended June 30, 2024, driven by higher payroll costs from an increase in headcount from 105 to 136[319]. - Total operating expenses increased by $2.0 million, or 6.0%, for the six months ended June 30, 2024, compared to the same period in 2023[303]. Income and Net Profit - Income from operations was $7.6 million for the three months ended June 30, 2024, down $2.9 million, or 28.0%, from $10.6 million in the same period in 2023[288]. - Net income for the three months ended June 30, 2024, was $4.4 million, compared to a net loss of $4.0 million in the same period in 2023, representing an increase of $8.4 million[288]. - Net income for the six months ended June 30, 2024, was $122, a decrease of $1,953, or 94.1%, compared to the same period in 2023[303]. - Net income attributable to Bitcoin Depot Inc. showed a loss during the six months ended June 30, 2024, due to losses allocated under the HLBV methodology and direct legal expenses[323]. Cash Flow and Financing - For the six months ended June 30, 2024, cash provided by operating activities was $11.475 million, a decrease of $15.124 million compared to $26.599 million in the same period of 2023[342]. - Net cash used in investing activities was $3.190 million for the six months ended June 30, 2024, a decrease of $3.172 million compared to $18 million in the same period of 2023[344]. - Net cash provided by financing activities increased by $42.6 million for the six months ended June 30, 2024, compared to the same period in 2023, primarily due to a $20.4 million increase in proceeds from notes payable[345]. - The company refinanced $20.8 million of its credit agreement with an annual interest rate of 17%, requiring monthly interest payments and fixed principal payments every six months[337]. - On March 26, 2024, the company amended its credit agreement to provide an additional $15.7 million in principal financing, increasing the total term loan facility to $35.6 million[340]. Regulatory and Market Risks - New regulations in California, effective July 1, 2025, impose a daily limit of $1,000 on transactions at crypto kiosks, which may negatively impact revenue in the state[266]. - The company is exposed to market risk from changes in foreign currency exchange rates and interest rates, managed through normal operating and financing activities[361]. - The company is assessing the impacts of recently issued accounting standards on its consolidated financial statements, including ASU 2023-06 and ASU 2023-07[357][358]. - The company believes that adequate provisions for resolution of all contingencies, claims, and pending litigation have been made for probable losses that are reasonably estimable[351].

Business Operations - As of March 31, 2024, Bitcoin Depot operates approximately 7,100 Bitcoin ATMs across North America, maintaining a leading position in the cash-to-Bitcoin BTM market [222]. - The number of installed kiosks increased to 7,061 as of March 31, 2024, up from 6,334 in the previous year [233]. - Bitcoin Depot's largest BTM deployment is with Circle K, with approximately 1,300 kiosks installed in their stores as of March 31, 2024 [224]. - The company has expanded its BDCheckout product to approximately 6,700 retail locations as of March 31, 2024 [222]. - The company currently supports Bitcoin purchases from users at only 28 kiosks, which is less than 1.0% of the total kiosks [244]. - The company has no open purchase orders for kiosks as of March 31, 2024 [294]. Financial Performance - Revenue for the three months ended March 31, 2024, was $138.5 million, a 1.2% increase compared to $136.7 million for the same period in 2023, despite Bitcoin's market price increasing by 150% during that time [225]. - Revenue for the three months ended March 31, 2024, decreased by $25.1 million, or 15.3%, compared to the same period in 2023, primarily due to a decrease in kiosk transaction revenue [253]. - Kiosk transaction revenue decreased by $25.2 million, or 15.5%, for the three months ended March 31, 2024, attributed to a decrease in the number of users and transaction volume, with regulatory changes in California accounting for approximately 50% of the revenue decline [257]. - Adjusted Gross Profit for the three months ended March 31, 2024, was $17.252 million, down from $22.303 million in the same period in 2023 [282]. - Adjusted EBITDA for the three months ended March 31, 2024, was $4.885 million, compared to $13.633 million for the same period in 2023 [287]. - The company reported a net loss of approximately $4.2 million during the three months ended March 31, 2024 [273]. - Net loss for the three months ended March 31, 2024, was $4.2 million, compared to a net income of $6.1 million for the same period in 2023, representing a decline of $10.3 million [252]. Expenses - The cost of revenue (excluding depreciation and amortization) decreased by $20.0 million, or 14.2%, for the three months ended March 31, 2024, primarily due to a decrease in transaction volume and regulatory changes [260]. - Cryptocurrency expenses decreased by $19.2 million, or 15.0%, for the three months ended March 31, 2024, compared to the same period in 2023, mainly due to lower transaction volume [262]. - Operating expenses increased by $2.9 million, or 21.4%, for the three months ended March 31, 2024, compared to the same period in 2023, driven by higher selling, general, and administrative expenses [252]. - Selling, general and administrative expenses increased by $2.8 million, or 25.6%, for the three months ended March 31, 2024, due to higher payroll costs from an increase in headcount from 92 to 138 [268]. - Other expenses increased by approximately $1.9 million, or 57.8%, for the three months ended March 31, 2024, primarily due to increased interest expense [269]. - Floorspace lease expenses decreased by $0.5 million, or 5.5%, for the three months ended March 31, 2024, compared to the same period in 2023 [266]. - Kiosk operations costs decreased by $0.3 million, or 6.9%, for the three months ended March 31, 2024, compared to the same period in 2023 [267]. Regulatory Impact - New regulations in California will limit the amount of funds that can be accepted or dispensed at crypto kiosks to $1,000 per day starting January 1, 2024, which may impact revenue [229]. - The company assesses legal contingencies and records estimates of probable losses when they can be reasonably estimated [297]. - The company believes that adequate provisions for resolution of all contingencies and claims have been made for probable losses that are reasonably estimable [300]. Cash Flow and Capital - Cash provided by operating activities decreased by $8.7 million for the three months ended March 31, 2024, primarily due to a $10.3 million decrease in net income [291]. - The company had working capital of approximately $7.2 million as of March 31, 2024, with cash and cash equivalents of approximately $51.7 million [273]. - Net cash used in financing activities increased by $17.4 million for the three months ended March 31, 2024, compared to the same period in 2023, driven by a $15.2 million increase in proceeds from notes payable [293]. - The company announced a share repurchase program to buy back up to $10 million of its Class A common stock, with $0.4 million spent on repurchases by March 31, 2024 [280]. Accounting Standards - The company adopted ASU 2021-08 effective January 1, 2023, with no impact on the consolidated financial statements [302]. - The company is still assessing the impacts of ASU 2023-06, ASU 2023-07, ASU 2023-08, and ASU 2023-09 on its consolidated financial statements [304][305][307][306]. Market Risk - The company is exposed to market risk from changes in foreign currency exchange rates and interest rates, managed through normal operating and financing activities [309].

Financial Performance - As of December 31, 2023, the company generated approximately $689.0 million in revenue, a 6.5% increase from $646.8 million in 2022, with a gross profit of $88.6 million, representing a gross profit margin of 12.9%[31] - For the year ended December 31, 2023, the company generated revenue of approximately $689.0 million, a 6.3% increase from $646.8 million in 2022, with gross profit rising to $88.6 million from $53.5 million[61] - The company reported an Adjusted EBITDA of $56.3 million for the year ended December 31, 2023, representing 14.7% of Adjusted Gross Profit Margin[31] - The company has experienced seasonality in revenue during the 4th quarter, attributed to fewer business days due to public holidays[95] User Engagement and Transactions - The company completed over 3.3 million user transactions from inception in July 2016 through December 31, 2023, totaling approximately $2.3 billion in transaction value[31] - The average monthly active users for the year ended December 31, 2023, was approximately 21,824, indicating a growing user base[31] - Bitcoin accounts for 99% of total transaction volume for the year ended December 31, 2023, with other cryptocurrencies making up less than 1%[511] Market Presence and Expansion - The company operates approximately 6,300 kiosks across 48 U.S. states and 10 Canadian provinces, addressing approximately 52% of the U.S. population[32] - The company holds a market share of 23% in the U.S. and 11% in Canada as of December 31, 2023, making it the largest BTM operator in North America[47] - The company has installed approximately 1,300 BTMs in Circle K stores, its largest deployment, which is part of a broader strategy to partner with major retail chains[29] - The company operates approximately 2,200 BTMs across 56 major national and regional retailers in the U.S., with Circle K representing approximately 27% of total revenues for 2023[80] - As of December 31, 2023, BDCheckout is available at approximately 5,700 retail locations, allowing users to load cash into their accounts and purchase Bitcoin, thereby diversifying revenue streams[63] - The company plans to expand its geographical footprint, having applied for a license to operate in New York, which could support thousands of kiosks[60] - The company has a strategic partnership with GetGo® Café + Market to install BTMs in 125 locations, enhancing its presence in the Midwest and Mid-Atlantic[64] - A master placement agreement with EG America LLC will result in the installation of BTMs in approximately 900+ locations, marking a significant expansion[68] Compliance and Regulatory Environment - Approximately 4% of overall transaction volumes are from user bans due to compliance issues, reflecting the company's commitment to robust compliance procedures[55] - The company is subject to various anti-money laundering laws, including the BSA in the U.S., requiring a risk-based anti-money laundering program[99] - The company has applied for a BitLicense from the NYDFS to operate as a licensed money transmitter[100] - The company is currently not supervised or examined by any banking, securities, or commodities regulator[96] Strategic Initiatives and Partnerships - The BDCheckout product allows users to purchase Bitcoin at several thousand additional retail locations, enhancing the company's market reach without incurring upfront hardware costs[40] - The company intends to pursue strategic acquisitions to enhance capabilities in areas such as cybersecurity and compliance, supporting its growth strategy[62] - The management team has extensive experience in technology and business, providing a competitive advantage in attracting talent and pursuing acquisition opportunities[58] Operational Challenges and Risks - Equipment costs for new kiosks may be significantly impacted by inflation, supply constraints, and labor shortages[512] - The competitive landscape is characterized by a variety of current and potential competitors with larger customer bases and greater resources[513] - Competition is expected to intensify as new products and services are introduced by existing and new competitors[513] - The company maintains a low Bitcoin balance, typically less than $1 million, to manage volatility and differentiate itself from competitors[57] - The company holds typically less than $1 million in Bitcoin at any given time, due to high transaction volumes[89] - The company may seek to mitigate foreign currency risk through timely settlement of transactions and cash flow matching[509] Currency and Financial Management - The total number of BTMs deployed globally grew from 968 in 2017 to 33,936 by December 31, 2023, reflecting a CAGR of approximately 84%[46] - For the year ended December 31, 2023, the average daily USD balance held in fiat wallets on the Gemini exchange was approximately $0.5 million[84] - Currency exchange rate fluctuations had an insignificant impact on consolidated revenues for the years ended December 31, 2023, and 2022[508] - The company is exposed to currency fluctuations on transactions not denominated in the functional currency, but these gains and losses were also insignificant[509] - The assets and liabilities of foreign subsidiaries are translated at the period end rate of exchange, affecting stockholders' equity[510] - Transaction gains and losses for the years ended December 31, 2023, and December 31, 2022, were insignificant[509] Legal Matters - The Canaccord Claim asserts that Canaccord is entitled to $23.0 million in fees for breach of contract, which the company intends to vigorously defend against[107]

Business Operations - As of September 30, 2023, Bitcoin Depot operates approximately 6,400 Bitcoin ATMs (BTMs) across North America, maintaining a leading position in the cash-to-Bitcoin BTM market [262]. - The number of installed kiosks at the end of September 30, 2023, was 6,404, showing a slight increase from 6,351 in the previous quarter [275]. - Bitcoin Depot's BDCheckout product is accepted at approximately 5,455 retail locations as of September 30, 2023 [275]. - The company currently supports Bitcoin purchases at only 31 kiosks, representing less than 1.0% of total kiosks, with no plans to expand this capability [285]. - The company generates revenue from software services provided to third-party BTM operators, earning a variable fee equal to a percentage of the cash value of transactions processed [386]. - The company’s revenue from contracts with customers is primarily derived from the sale of cryptocurrencies at the point-of-sale, with a typical transaction process time of 30 minutes or less [381]. Financial Performance - Revenue for the nine months ended September 30, 2023, was $540.6 million, representing a 6.3% year-over-year growth, while the market price of Bitcoin increased by 40% during the same period [265]. - Revenue for the three months ended September 30, 2023, was $179.5 million, with a gross profit of $23.7 million, resulting in a gross profit margin of 13.2% [347]. - Revenue increased by approximately $43.4 million, or 8.7%, for the nine months ended September 30, 2023, compared to the same period in 2022, primarily due to increases in kiosk transaction revenue [314]. - Kiosk transaction revenue rose by approximately $47.8 million, or 9.7%, for the nine months ended September 30, 2023, driven by an increase in average transaction size and user volume [315]. - Adjusted Gross Profit for the nine months ended September 30, 2023, was $79.5 million, with an Adjusted Gross Profit Margin of 14.7% [347]. - Adjusted EBITDA for the nine months ended September 30, 2023, was $47.4 million, with an Adjusted EBITDA margin of 8.8% [351]. Expenses and Costs - Selling, general and administrative expenses increased by $4.6 million, or 38.9%, for the three months ended September 30, 2023, driven by higher payroll costs and professional services expenses [306]. - Selling, general and administrative expenses increased by approximately $16.6 million, or 62.4%, for the nine months ended September 30, 2023, largely due to merger-related costs and higher payroll expenses [330]. - Cost of revenue (excluding depreciation and amortization) decreased by $0.9 million, or 0.6%, for the three months ended September 30, 2023, primarily due to reduced rent expenses [298]. - The cost of revenue (excluding depreciation and amortization) increased by approximately $17.1 million, or 3.9%, for the nine months ended September 30, 2023, driven by network expansion and increased transaction volume [320]. - Cryptocurrency expenses increased by approximately $17.8 million, or 4.4%, for the nine months ended September 30, 2023, primarily due to higher transaction amounts [322]. Mergers and Acquisitions - The acquisition of BitAccess in July 2021 is expected to generate significant savings in transaction processing fees and reduce operating expenses, although its revenue impact has not yet been material [268]. - The merger with GSRM was completed on June 30, 2023, resulting in a restructuring of the company's equity and operational framework [269]. Cash Flow and Financing - The Company reported a net cash provided by operating activities of $33.57 million for the nine months ended September 30, 2023, compared to $21.99 million for the same period in 2022, reflecting an increase of $11.6 million [359][360]. - The net cash used in financing activities increased by $21.1 million for the nine months ended September 30, 2023, primarily due to a $14.4 million increase in principal payments on notes payable [362]. - The Company issued 4,300,000 shares of Class A common stock through a PIPE Financing, representing gross proceeds of up to approximately $50 million [357]. - The Amended and Restated Credit Agreement includes a total borrowing of $20.8 million with an annual interest rate of 17%, maturing on June 23, 2026 [356]. Market and Competition - The digital financial system is highly competitive, with numerous competitors having larger customer bases and greater resources, necessitating continuous innovation and competitive pricing [414]. - Competition is expected to intensify as both existing and new competitors introduce new products and services [414]. - The broader adoption of Bitcoin is crucial for the company's business, as it is dependent on the cryptocurrency's market price and general acceptance [412]. - The company anticipates continued growth from its addressable market as cryptocurrency adoption increases among the general public [412]. Risk Management - Bitcoin Depot maintains a sophisticated Bitcoin management process, typically holding less than $0.8 million in Bitcoin to mitigate price volatility risks [266]. - The company has not historically hedged its foreign currency translation risk, and currency exchange rate fluctuations had an insignificant impact on consolidated revenues for the three and nine months ended September 30, 2023 [409]. - The company may consider hedging its foreign currency exposure in the future [409]. - The cost of new kiosks is significantly impacted by inflation, supply constraints, and labor shortages, potentially leading to higher acquisition costs [413].