Bakkt Stock (BKKT) Plunges on Earnings, Offering & Loyalty Business Sale

Bakkt Holdings, Inc. (NYSE: BKKT) is reeling after announcing its preliminary Q2 2025 financial results, the sale of its Loyalty business, and the pricing for an offering of common stock triggered a sharp 40% drop in pre-market trading.

Bakkt stock, having closed out at $17.17, is now changing hands at $10.36, firmly under pressure.

The pre-market sell-off reflects investor concerns about Bakkt's financial health and the implications of its strategic pivot. The company's decision to divest its Loyalty business signals a narrowing focus on its core crypto offerings, but also highlights challenges in diversifying revenue streams.

Bakkt also priced it's offering of ~ 6,75million shares of Class A common stock at $10, reflecting a substantial discount on the previous close.

Bakkt estimates Q2 2025 total revenues between $577 million and $579 million, with gross crypto revenues accounting for $568 million to $569 million. Net loyalty revenues are projected at $9 million to $10 million. However, total crypto costs and execution, clearing, and brokerage fees are estimated to be substantial, ranging from $565 million to $566 million, leaving thin margins.

As of June 30, 2025, Bakkt expects to have between $60 million and $62 million in available cash and cash equivalents, including restricted cash. While the company has access to $40 million from a revolving credit agreement, the undrawn balance underscores the need for careful cash management. Net cash used in operating activities is estimated at $13 million to $15 million for the quarter.

The sale of the Loyalty business to Project Labrador Holdco, LLC, a subsidiary of Roman DBDR Technology Advisors, Inc, is expected to close in Q3 2025.

The transaction includes $11 million in cash accommodations to the buyer, along with adjustments for negative working capital and indebtedness, plus a short-term loan of restricted cash.

Bakkt will report the Loyalty business as a discontinued operation beginning in Q3 2025.

“With the pending sale of our Loyalty business, Bakkt is achieving a significant milestone and fully embracing its future as a streamlined, pure-play crypto infrastructure company,” stated Andy Main, President and Co-CEO of Bakkt. “This strategic realignment is about sharpening our focus, allowing us to dedicate all our resources to our core crypto offerings and the immense opportunities in the stablecoin payments ecosystem.”

However, recent developments have added to investor unease. The non-renewal of key contracts with Webull (representing approximately 74% of its 2024 crypto services revenue) and Bank of America (accounting for about 16% of its 2024 loyalty services revenue) poses a significant challenge to Bakkt's future revenue streams.