Green Dot Corporation

Hello and welcome to the Green Dot Corp third quarter 2024 conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touchtone phone. To withdraw your question, please press star then two. Please note, this event is being recorded. I would now like to turn the conference over to Mr. Tim Willey, Senior Vice President, Finance and Corporate Development. Please go ahead.

Thank you and good afternoon, everyone. Today, we are discussing Green Dot's third quarter 2024 financial and operating results. Following our remarks, we'll open the call for your questions. Our most recent earnings release that accompanies this call and webcasts can be found at ir.greendot.com. As a reminder, Our comments may include forward-looking statements and expectations regarding future results and performance. Please refer to the cautionary language in the earnings release and in Green Dot's filings with the Securities and Exchange Commission, including our most recent Form 10-K and 10-Q, for additional information concerning factors that could cause actual results to differ materially from the forward-looking statements. During the call, we will refer to our financial measures that do not conform with generally accepted accounting principles. For the sake of clarity, unless otherwise noted, all numbers we will talk about today will be on a non-GAAP basis. Information may be calculated differently than similar non-GAAP data presented by other companies. Quantitative reconciliation of our non-GAAP financial information to the directly comparable GAAP financial information appears in today's press release. The content of this call is property of the Green Dot Corporation and is subject to copyright protection. Now, I'd like to turn the call over to George.

Good afternoon, and thank you for joining our third quarter earnings call. During the quarter, we delivered results in line with our expectations, and we have now largely moved past the headwinds associated with deconversions in the first half of 2023. As a result, we are seeing improved year-over-year performance with non-GAAP revenue up 16% and adjusted EBITDA up 19%, the strongest growth we have seen in these metrics in over two years. These results were driven by investments and continued improvement in our B2B segment, particularly BAS or embedded finance. We have also seen moderating rates of decline in actives on a year-over-year basis, and we posted sequential growth for the first time since the first quarter of 2021. This demonstrates we are making progress improving the financial and operational performance of Green Dot. As I have indicated on prior calls, our goal is not just to return Green Knot to a path of predictable performance and growth, but to also provide our partners and customers valuable solutions and deliver them in a highly secure, compliant, and scalable way. Over the long term, we believe this will solidify our competitive position while also ensuring that we are meeting the expectations of all of our stakeholders. Turning to the quarter, as I mentioned, our results were in line with our expectations, and we continued to focus on three key tenets of our story, investing in compliance, improving our cost structure, and building an engine of sustainable and steady opportunities. We made progress on all of these fronts during the quarter, and we continued investing in our compliance and regulatory infrastructure and saw year-over-year improvement in our adjusted EBITDA margins. We continue to see strong business pipelines and demand, which allows us to be very selective in considering only the highest quality opportunities that enable us to deliver on our high expectations related to risk management, compliance, and regulatory requirements and standards. You may have seen we recently announced the launch of Arc by Green Dot. Arc represents our embedded finance, or BaaS, capabilities that are powered by a secure, scalable, single-source platform. With this new brand, we have the opportunity to market and differentiate our end-to-end embedded banking and money movement tools that are designed for businesses of all sizes and do so in more meaningful, impactful ways. This launch represents a major milestone in our journey to establishing Green Dot as a leader and innovator in embedded finance, an industry we believe has significant long-term potential. We are excited about the feedback we are receiving from our partners and other industry leaders and influencers on this launch. And we look forward to developing the ARC brand further in 2025 and beyond. You will note we have modestly lowered our adjusted EBITDA guidance for 2024. While we tracked our expectations through the third quarter, as we moved through the third quarter and into October, it became clear that the difficult trends in our retail channel would persist longer than anticipated. Despite the anticipated shortfall, we remain committed to ensuring we are investing in the three key areas I just discussed with you. And separately, with some of our investments in conversions and tech debt eradication behind us, we are finally now investing in the modernization of the user experience for all of our consumer products, which will allow us to more vigorously compete in these product categories. Let me now hand it over to Jeff for his comments before I make some additional closing remarks and take your questions. Jeff?