Summary
Alkami Technology ended 2024 with fourth-quarter revenue of $89.7 million, up 25.6% from the year-ago quarter. Full-year revenue reached $333.8 million, up 26.1% from 2023. Gross profit was $53.2 million in the quarter, up 33.2%, and $196.6 million for the year, up 36.4%. Gross margin expanded to 59.3% from 56.0% in the quarter and to 58.9% from 54.4% for the full year. The company still recorded an operating loss of $8.6 million in the quarter, compared with $13.1 million a year earlier, and a full-year operating loss of $44.6 million, compared with $63.7 million. Net loss was $7.6 million in the quarter, compared with $12.7 million, and $40.8 million for the year, compared with $62.9 million. Diluted EPS for the full year was -$0.41, compared with -$0.67. Operating margin was -9.6% in the quarter, compared with -18.4%, and -13.4% for the full year, compared with -24.1%.
Operating cash flow was $6.1 million in the fourth quarter, up from negative $5.3 million a year earlier, and $18.6 million for the full year, up from negative $17.5 million. Capital expenditures were $0.16 million in the quarter, down from $0.28 million, and $1.20 million for the full year, up from $1.06 million. Deferred revenue was $13.58 million at December 31, 2024, up from $10.98 million a year earlier. Remaining performance obligations were $1.40 billion, up from $1.10 billion. Annual recurring revenue was $356 million, up 22% from December 31, 2023. Registered users reached 20.0 million, up 2.5 million or 14% from a year earlier. Digital banking clients totaled 272, compared with 236 a year earlier. In the fourth quarter, Alkami signed 12 new digital banking platform clients, implemented 8 clients, and ended with 39 new clients in implementation backlog representing 1.3 million digital users. Net dollar retention was 113%, and last-twelve-month churn was less than 1%.
The company signed a definitive agreement to acquire MANTL for an enterprise value of $400 million. It plans to fund the deal with approximately $380 million in cash and restricted stock units worth an estimated $13 million for continuing MANTL employees. The acquisition is expected to close on or before March 31, 2025, subject to standard conditions. Management included MANTL in its 2025 outlook. For the first quarter ending March 31, 2025, Alkami guided to adjusted EBITDA of $9.5 million to $10.5 million. For the full fiscal year ending December 31, 2025, the company guided to adjusted EBITDA of $47.0 million to $51.0 million. Starting in the second quarter of 2025, MANTL is expected to contribute an adjusted EBITDA loss of $5 million to the full-year 2025 results. MANTL's annual recurring revenue under contract at December 31, 2025 is expected to be approximately $60 million, which represents year-over-year growth of over 30%. MANTL has 112 financial institution clients and its automation supports median retail account opening in under five minutes, business account opening in under 10 minutes, and automated decisions on 85% of applications on average.
The quarter showed improving profitability and cash generation, but Alkami remains a company with a limited operating history and a history of operating losses. The MANTL acquisition adds integration risk. The company faces risks tied to managing future growth, attracting new clients and retaining and expanding existing clients, long and unpredictable sales cycles, reliance on third-party software and services, competition, cybersecurity breaches, regulatory compliance, and a downturn or consolidation in financial services technology spend. It also needs to integrate acquired companies successfully and retain key employees. Non-GAAP measures showed a similar improving trend: adjusted EBITDA was $10.2 million in the fourth quarter, compared with $3.1 million a year earlier, and $26.9 million for the full year, compared with negative $1.6 million. Non-GAAP gross margin was 63.1% in the quarter, compared with 60.3%, and 62.7% for the full year, compared with 59.0%.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q4 FY2024 | Q3 FY2024 | QoQ | Q4 FY2023 | YoY |
|---|---|---|---|---|---|
| Revenue | $89.7M | $85.9M | +4.4% | $71.4M | +25.6% |
| Gross profit | $53.2M | $50.6M | +5.1% | $39.9M | +33.2% |
| Gross margin | 59.4% | 58.9% | +0.4 pp | 56.0% | +3.4 pp |
| Research & development | $25.3M | $24.1M | +5.0% | $21.5M | +18.0% |
| Sales & marketing | $14.6M | $14.4M | +1.0% | $11.9M | +22.7% |
| General & administrative | $21.6M | $22.1M | -2.6% | $19.3M | +11.8% |
| Total operating expenses | $61.8M | $61.0M | +1.3% | $53.0M | +16.6% |
| Operating income (loss) | -$8.6M | -$10.4M | +17.3% | -$13.1M | +34.1% |
| Operating margin | -9.6% | -12.1% | +2.5 pp | -18.4% | +8.7 pp |
| Net income (loss) | -$7.6M | -$9.4M | +19.1% | -$12.7M | +39.9% |
| Net margin | -8.5% | -11.0% | +2.5 pp | -17.8% | +9.3 pp |
| Diluted EPS | -$0.08 | -$0.09 | +$0.01 | -$0.67 | +$0.59 |
Risks
All revenues derive from financial institutions, an industry facing economic and political uncertainty, liquidity concerns, rapid interest rate increases, inflation, consolidation, distress and failure, with few new FIs being created. Client failures or mergers could reduce revenue or give larger FIs leverage to negotiate lower prices.
The sales process typically lasts from three to 12 months or longer, and implementation generally ranges from six to 12 months depending on integration depth. Delays can postpone revenue recognition and increase costs.
The company primarily serves clients from third-party data centers provided by AWS and cannot easily switch its AWS operations to another cloud provider. Any disruption or interference with AWS could increase operating costs and impair delivery of solutions.
As a financial technology provider, the company is a target and has experienced cybersecurity attacks, insider threats and other incidents, though none have had a material impact to date. The use of generative AI has made it easier for threat actors to develop attacks, and acquired companies may have cybersecurity vulnerabilities.
The company is subject to GLBA, CCPA, GDPR and other privacy laws; GDPR fines can reach 20 million euros or 4% of annual global revenues, and CCPA provides a private right of action for certain data breaches. Compliance may require modifying data practices and incurring substantial costs.
On February 27, 2025, the company agreed to acquire MANTL for approximately $380 million, subject to purchase price adjustments, and is evaluating financing options including cash, credit facility, equity or debt. Integration failure, dilution, or additional debt could materially affect financial condition.
Competitors may introduce products based on new or alternative technologies such as artificial intelligence and machine learning, which could render the Alkami Digital Banking Platform obsolete or less effective. The company also incorporates AI/ML features, which may create additional cybersecurity risks.
The platform integrates with third-party core processing and payment systems, but the company does not have formal arrangements with many third-party providers regarding API access. Failure to integrate effectively could disrupt client operations and harm satisfaction.
Success depends on continued services of CEO Alex Shootman, CFO W. Bryan Hill and other key employees, and competition for executive officers, software developers and skilled personnel is intense. If the perceived value of equity awards declines, attracting and retaining employees may be adversely affected.
The company has experienced rapid growth in headcount and operations and expects continued rapid growth, placing significant demands on management and operational and financial infrastructure. Failure to manage growth could increase costs, hurt client satisfaction and harm results.
Third-party service offerings that the company resells typically have much higher cost of revenues than internally developed offerings, so any increase in sales of third-party services as a proportion of subscriptions would adversely affect overall gross margin. MD&A notes cost of revenues increased $16.5 million, or 13.7%, for 2024 compared to 2023, driven by $14.6 million in higher costs of third-party partners.
The company has limited historical data on client subscription renewal rates and cannot be certain of anticipated renewal rates. Large or influential FI clients may demand more favorable pricing or contract terms, and the company has changed its pricing model in the past and expects to be required to do so in the future.
Subscription revenue is recognized over the contractual term beginning from live use, so the substantial majority of revenue reported in each quarter relates to agreements entered into in previous quarters. Changes in new client agreements or implementations may not be fully reflected in results until future periods.
The Amended Credit Agreement, as amended by the Second Amendment on July 1, 2024, extended maturity to April 29, 2027, increased the revolver commitment to $125.0 million, and contains covenants including minimum recurring revenue growth, liquidity of $20.0 million or more, and free cash flow of not less than $(25.0) million. Borrowings bear interest at a variable rate, making the company vulnerable to rate increases.
The company no longer qualifies as an emerging growth company as of December 31, 2024, and became a large accelerated filer. It must now comply with additional requirements including auditor attestation of internal control over financial reporting and three years of audited financial statements, which will substantially increase legal and financial compliance costs.
Certain significant stockholders sold 5.0 million and 7.5 million shares in separate underwritten secondary offerings in August 2024 and November 2024, respectively. Future sales or the perception of future sales could depress the market price of common stock and impair ability to raise capital.
The company established a subsidiary in India during 2024, and while operations are currently immaterial, it faces risks related to regulatory compliance, tax implications, labor laws, currency fluctuations, operational scaling, and weaker intellectual property and confidentiality protections. Historical wage inflation in India has been higher than in the U.S., and a stronger Rupee would increase costs.
The company has substantial net operating loss carryforwards, but Sections 382 and 383 may limit their use if it undergoes an ownership change. A portion of NOLs will begin to expire in 2034 and 2024 for federal and state purposes, respectively.
SaaS KPIs
All quarters →Non-GAAP Gross Margin
Adjusted EBITDA
Registered Users
Revenue per Registered User (RPU)
Annual Recurring Revenue (ARR)
Average Contract Life
LTM churn
Remaining Performance Obligation (RPO)
Clients with ARR $1M
Digital Banking Clients
Subscription Revenue Mix
Implementation Backlog
Summary, forecast, risks and KPIs are extracted from ALKAMI TECHNOLOGY, INC.'s SEC filings for Q4 FY2024 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 2, 2026.