Bakkt Announces Non-Cash Goodwill and Other Intangible Assets Impairment Charge
October 28 2022 - 04:41PM
Business Wire
Bakkt Holdings, Inc. (NYSE: BKKT) (the “Company” or “Bakkt”)
announced that it completed its annual impairment testing of
goodwill and other intangible assets as required by Accounting
Standards Codification (ASC) 350 “Intangibles Goodwill and Other.”
As a result of the testing, the Company will record a partial,
non-cash goodwill and other intangible assets impairment charge in
the quarter ended September 30, 2022. The Company does not expect
the impairment charge to have any impact on future operations, or
to affect its liquidity or cash flows from operating
activities.
In accordance with generally accepted accounting principles, the
Company conducted a quantitative test of goodwill and intangible
assets for impairment due to the elongated timing for expected
cryptoasset product activations and the decline in its market
capitalization as of September 30, 2022. As a result of the
impairment analysis, it was concluded that the carrying value of
the Company’s reporting unit exceeded its market value and the
Company will record an estimated impairment loss on goodwill of
approximately $1,300-1,400 million and on certain indefinite-lived
intangible assets of approximately $150-$160 million.
“Despite the challenging market dynamics this year that have
negatively impacted our stock price and the pace of partner
activations, we remain optimistic about our underlying business.
The charge is not reflective of our strong cash position, partner
pipeline and diversified product offerings, and we remain excited
about our future growth potential,” said Karen Alexander, Bakkt’s
Chief Financial Officer.
As previously announced, Bakkt will release its complete third
quarter 2022 earnings on Thursday, November 10, 2022, before market
open. Management will host a conference call at 9:00 a.m. ET on the
same day to review the results and answer questions. Please refer
to our earnings announcement press release from October 27, 2022
for details on how to access the live call and for replay
information.
The conference call will be webcast live and archived on the
investor relations section of Bakkt’s corporate website under the
‘Events & Presentations’ section, along with any related
earnings materials.
About Bakkt
Bakkt is a trusted digital asset platform that enables consumers
to buy, sell, store and spend digital assets. Bakkt’s platform, now
available through the Bakkt App and to partners, amplifies consumer
spending and bolsters loyalty programs, adding value for all key
stakeholders within the Bakkt payments and digital assets
ecosystem. Launched in 2018, Bakkt is headquartered in Alpharetta,
GA. For more information, visit: https://www.bakkt.com/ | Twitter
@Bakkt | LinkedIn https://www.linkedin.com/company/bakkt/
Bakkt-C Source: Bakkt Holdings, Inc.
Note on Forward-Looking Statements
This press release contains “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Such statements include, but are not limited to,
statements regarding Bakkt’s guidance, plans, objectives,
expectations and intentions with respect to future operations,
products, services and the application of Bakkt’s available cash,
among others. Forward-looking statements can be identified by words
such as “will,” “likely,” “expect,” “continue,” “anticipate,”
“estimate,” “believe,” “intend,” “plan,” “projection,” “outlook,”
“grow,” “progress,” “potential” or words of similar meaning. Such
forward-looking statements are based upon the current beliefs and
expectations of Bakkt’s management and are inherently subject to
significant business, economic and competitive uncertainties and
contingencies, many of which are difficult to predict and beyond
Bakkt’s control. Actual results and the timing of events may differ
materially from the results anticipated in such forward-looking
statements. You are cautioned not to place undue reliance on such
forward-looking statements. Such forward-looking statements relate
only to events as of the date on which such statements are made and
are based on information available to us as of the date of this
press release. Unless otherwise required by law, we undertake no
obligation to update any forward-looking statements made in this
press release to reflect events or circumstances after the date of
this press release or to reflect new information or the occurrence
of unanticipated events.
The following factors, among others, could cause actual results
and the timing of events to differ materially from the anticipated
results or other expectations expressed in such forward-looking
statements: (i) the impact of the ongoing COVID-19 pandemic; (ii)
changes in the markets in which Bakkt competes, including with
respect to its competitive landscape, technology evolution or
regulatory changes; (iii) changes in the markets that Bakkt
targets; (iv) risk that Bakkt may not be able to execute its growth
strategies, including identifying and executing acquisitions; (v)
risks relating to data security; and (vi) risk that Bakkt may not
be able to develop and maintain effective internal controls. The
foregoing list of factors is not exhaustive. You should carefully
consider the foregoing factors and the other risks and
uncertainties described under the heading “Risk Factors” in Bakkt’s
filings with the Securities and Exchange Commission, including its
most recent Annual Report on Form 10-K and any subsequent Quarterly
Reports on Form 10-Q.
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version on businesswire.com: https://www.businesswire.com/news/home/20221028005456/en/
Investor Relations Ann DeVries, Head of Investor
Relations Ann.DeVries@bakkt.com
Media Lauren Post, Head of Communications
Lauren.Post@bakkt.com
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