Ethereum Is Soaring. 3 Reasons Investors Should Pay Attention.
Ethereum is now up 65% over the past 30 days, and is starting to decouple from Bitcoin.
Ethereum's recent performance could signal the arrival of "altcoin season," when risky, speculative cryptocurrencies tend to outperform.
New crypto legislation is opening up high-growth opportunities for Ethereum in areas such as stablecoins.
10 stocks we like better than Ethereum ›
Seemingly out of nowhere, Ethereum (CRYPTO: ETH) has become one of the hottest cryptocurrencies on the planet. It's now up 65% over the past 30 days, and analysts are busy ratcheting up their price targets for just how high Ethereum might go in 2025 and beyond.
Ethereum's rapid rise over the past few months could have important implications for your investment portfolio. Here are three reasons why investors should be paying attention.
The arrival of "altcoin season"?
Ethereum's rise has been so meteoric that it is now outpacing Bitcoin (CRYPTO: BTC), which is only up 15% over the past 30 days. This isn't supposed to happen. Historically, there has been a very tight correlation between price movements in Bitcoin and Ethereum.
As a result, some investors are already starting to suggest that Ethereum's decoupling from Bitcoin could signal the arrival of "altcoin season." This is the time of the year when investors shift away from Bitcoin and into riskier, more speculative cryptocurrencies (such as viral meme coins) in search of higher returns.
Typically, the first tell-tale sign of "altcoin season" is when Ethereum starts to overheat. This is then followed by money flowing into riskier and riskier cryptocurrencies, until a vast speculative bubble starts to form. If history is any guide, this is what could be happening now.
Already, investors are starting to talk up the types of cryptos that might "pop" during this altcoin season. So, any vacation you might have planned during August could be the perfect time to think about ways you can diversify your portfolio away from Bitcoin in order to capture some of this potential upside.
New momentum for Ethereum in two key areas
Two new pieces of crypto legislation -- the Genius Act and the Clarity Act -- are now passing through Congress, and hopes are already building about what this could mean for Ethereum. The thinking here is that the combination of the Genius Act (which governs stablecoins) and the Clarity Act (which provides a regulatory framework for all digital assets) might create a sort of "perfect storm" for Ethereum's future development.
That's because Ethereum is a powerhouse when it comes to both stablecoins and decentralized finance (DeFi), and these are exactly the two areas of the crypto market that this new legislation is designed to help.
With that in mind, investors need to keep their eyes open for new investment opportunities that involve DeFi, and especially those that involve stablecoins. The hype around stablecoins might be a bit overblown, but even the most cynical investor has to admit that something huge is happening here. Stablecoins have grown from a sleepy $20 billion industry in 2020 to a $250 billion industry today. And Treasury Secretary Scott Bessent thinks stablecoins could hit $2 trillion within just a few years.
A new way to invest in Ethereum
Finally, keep your eyes open for new ways to invest in Ethereum. Arguably, the most exciting of these opportunities are the new Ethereum Treasury Companies that have been appearing ever since the end of May. There are now three publicly traded companies -- Bitmine Immersion Technologies (NYSEMKT: BMNR), Bit Digital (NASDAQ: BTBT), and SharpLink Gaming (NASDAQ: SBET) -- that have ditched their old business models and gone all-in on Ethereum. And one more -- The Ether Machine -- is on its way.
The goal of these companies is to become "the Strategy (NASDAQ: MSTR) of Ethereum." Strategy has become one of the top-performing publicly traded companies in the world by building up a massive Bitcoin position on its balance sheet. In a similar way, companies are now racing to amass Ethereum on their balance sheets, in the hopes of delivering similar types of performance.
For investors, this opens up new possibilities. It might be the case, for example, that you can earn higher returns by investing in these Ethereum Treasury Companies than by investing in Ethereum itself.
Before you invest in Ethereum
Does all this sound too good to be true? Maybe it is. After all, even though Ethereum has turned in some blistering performance of late, it's still only up 10% for the year. If you look at a chart for Ethereum for 2025, you'll see that it's been a roller coaster ride. Ethereum was on a rapid downward path for the first five months of the year, and is now rising nearly as fast on the upside.
As a result, some of the updated price forecasts for Ethereum might be overly optimistic. The all-time high for Ethereum is under $5,000, but some are already predicting that Ethereum could hit $15,000 soon. That just doesn't seem to be realistic. So before you invest in Ethereum, make sure you do your due diligence.
Should you invest $1,000 in Ethereum right now?
Before you buy stock in Ethereum, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Ethereum wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $636,628!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,063,471!*
Now, it's worth noting Stock Advisor's total average return is 1,041% — a market-crushing outperformance compared to 183% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor.
See the 10 stocks »
*Stock Advisor returns as of July 21, 2025
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Globe and Mail
6 minutes ago
- Globe and Mail
D-Wave Reports Second Quarter 2025 Results
D-Wave Quantum Inc. (NYSE: QBTS) ('D-Wave' or the 'Company'), a leader in commercial quantum computing systems, software, and services, today announced financial results for its second quarter ended June 30, 2025. 'Our second quarter results show consistently strong performance across a multitude of technical and business metrics,' said Dr. Alan Baratz, CEO of D-Wave. 'During the quarter, we brought to market our sixth-generation quantum computer, signed a memorandum of understanding related to the acquisition of an on-premises system in South Korea, completed physical assembly of the previously announced system at Davidson Technologies, introduced a collection of developer tools to advance quantum AI and machine learning innovation, and ended the quarter with a record $819 million in cash. We're confident in our ability to continue delivering long-term value for our customers, partners and shareholders.' Recent Business and Technical Highlights Announced revenue of $3.1 million for the second quarter of fiscal 2025. This is an increase of $0.9 million, or 42%, from revenue of $2.2 million for the second quarter of fiscal 2024. Completed a successful $400 million At-the-Market (ATM) equity offering, contributing to D-Wave's consolidated cash balance of approximately $819 million as of June 30, 2025, a record quarter-end balance for the Company. The Company intends to use the proceeds from this financing primarily for strategic acquisitions and general corporate purposes including providing additional working capital and funding capital expenditures. Announced the general availability of D-Wave's Advantage2 quantum computer, its most advanced and performant system. The Advantage2 system is a powerful and energy-efficient annealing quantum computer capable of solving computationally complex problems beyond the reach of classical computers. Featuring D-Wave's most advanced quantum processor to date, the Advantage2 system is commercial-grade, and built to address real-world use cases in areas such as optimization, materials simulation and artificial intelligence. The system features increased connectivity, reduced noise, greater coherence, and increased energy scale, all contributing to faster and higher quality solutions. Announced a new strategic development initiative focused on advanced cryogenic packaging. Designed to advance and scale both gate model and annealing quantum processor development, the initiative builds on D-Wave's technology leadership in superconducting cryogenic packaging and will expand its multichip packaging capabilities, equipment, and processes. By bolstering D-Wave's manufacturing efforts with state-of-the-art technology, the Company aims to accelerate its development efforts in support of its aggressive product roadmap on the path to 100,000 qubits. Released a collection of offerings to help developers explore and advance quantum artificial intelligence (AI) and machine learning (ML) innovation, including an open-source quantum AI toolkit and a demo. The quantum AI toolkit enables developers to seamlessly integrate quantum computers into modern ML architectures. The demo illustrates how developers can leverage this toolkit to explore using D-Wave™ quantum processors to generate simple images, reflecting a pivotal step in the development of quantum AI capabilities. Announced a strategic relationship with Yonsei University and Incheon Metropolitan City to accelerate the exploration, adoption and usage of quantum computing in South Korea. Under the terms of the memorandum of understanding (MOU), the three organizations intend to work together to advance mutual research and talent development for quantum computing, provide access to D-Wave's quantum computing systems and services, and collaborate on development of use cases in biotechnology, materials science and other areas. In addition, the MOU facilitates the organizations' efforts towards the acquisition of a D-Wave Advantage2 system at the Yonsei University International Campus in Songdo, Yeonsu-gu, Incheon. Signed a number of new and renewing customer engagements for both commercial and research applications, including – a European multinational electric utility company; GE Vernova – a global energy company; National Quantum Computing Centre (NQCC) – the UK's national lab for quantum computing; Nikon Corporation – a multinational corporation specializing in optics and precision technologies; NTT Data Corp. – a multinational IT services and consulting company; NTT DOCOMO – Japan's leading mobile operator; Sharp Corporation – a multinational electronics company; and the University of Oxford. Second Quarter Fiscal 2025 Financial Highlights Revenue: Revenue for the second quarter of fiscal 2025 was $3.1 million, an increase of $0.9 million, or 42%, from the fiscal 2024 second quarter revenue of $2.2 million. Bookings 1: Bookings for the second quarter of fiscal 2025 were $1.3 million, an increase of $0.6 million, or 92%, from the fiscal 2024 second quarter Bookings of $0.7 million. Customers: For the most recent four quarters, D-Wave had in excess of 100 revenue generating customers. GAAP Gross Profit: GAAP gross profit for the second quarter of fiscal 2025 was $2.0 million, an increase of $0.6 million, or 42%, from the fiscal 2024 second quarter GAAP gross profit of $1.4 million, with the increase due primarily to the growth in revenue. GAAP Gross Margin: GAAP gross margin for the second quarter of fiscal 2025 was 63.8%, an increase of 0.2% from the fiscal 2024 second quarter GAAP gross margin of 63.6%. Non-GAAP Gross Profit 2: Non-GAAP Gross Profit for the second quarter of fiscal 2025 was $2.2 million, an increase of $0.6 million, or 39%, from the fiscal 2024 second quarter Non-GAAP Gross Profit of $1.6 million. The difference between GAAP and Non-GAAP Gross Profit is limited to non-cash stock-based compensation and depreciation and amortization expenses that are excluded from the Non-GAAP Gross Profit. Non-GAAP Gross Margin 2: Non-GAAP Gross Margin for the second quarter of fiscal 2025 was 71.8%, a decrease of 1.3% from the fiscal 2024 second quarter Non-GAAP Gross Margin of 73.1%. The difference between GAAP and Non-GAAP Gross Margin is limited to non-cash stock-based compensation and depreciation and amortization expenses that are excluded from the Non-GAAP Gross Margin. GAAP Operating Expenses: GAAP operating expenses for the second quarter of fiscal 2025 were $28.5 million, an increase of $8.3 million, or 41%, from the fiscal 2024 second quarter GAAP Operating Expenses of $20.2 million with the increase driven primarily by increases of $3.5 million in personnel costs, $2.4 million in non-cash stock-based compensation, $1.6 million in fabrication and related activities and $1.5 million in third party professional fees, partly offset by a recovery on a previously written-off debt of $1.1 million. The increased operating expenses stem from incremental investments to support the Company's continued growth and expansion. Non-GAAP Adjusted Operating Expenses 2: Non-GAAP Adjusted Operating Expenses for the second quarter of fiscal 2025 were $22.2 million, an increase of $6.7 million, or 43% from the fiscal 2024 second quarter Non-GAAP Adjusted Operating Expenses of $15.5 million, with the difference between GAAP and Non-GAAP Adjusted Operating Expenses being primarily non-cash stock-based compensation expense, non-cash depreciation and amortization, and non-recurring one-time expenses. Net Loss: Net loss for the second quarter of fiscal 2025 was $167.3 million, or $0.55 per share, an increase of $149.5 million, or $0.45 per share, from the fiscal 2024 second quarter net loss of $17.8 million, or $0.10 per share. The increase was primarily due to $142.0 million in non-cash, non-operating charges related to the remeasurement of the Company's warrant liability, as well as realized losses stemming from warrant exercises, that materially increased as a result of the significant price appreciation of the Company's warrants. Adjusted Net Loss 2: Adjusted Net Loss for the second quarter of fiscal 2025 was $25.3 million, or $0.08 per share, an increase of $5.3 million, and a decrease of $0.04 per share, from the fiscal 2024 second quarter Adjusted Net Loss of $20.0 million, or $0.12 per share, with the difference between Net Loss and Adjusted Net Loss being non-cash, non-operating warrant remeasurement related charges. Adjusted EBITDA Loss 2: Adjusted EBITDA Loss for the second quarter of fiscal 2025 was $20.0 million, an increase of $6.1 million, or 44%, from the fiscal 2024 second quarter Adjusted EBITDA Loss of $13.9 million with the increase due primarily to higher operating expenses, partly offset by higher gross profit. Financial Results for the First Half of Fiscal Year 2025 Revenue: Revenue for the six months ended June 30, 2025 was $18.1 million, an increase of $13.5 million, or 289%, from revenue of $4.6 million for the six months ended June 30, 2024. Bookings 1: Bookings for the six months ended June 30, 2025 were $2.9 million, a decrease of $0.4 million, or 13%, from Bookings of $3.3 million for the six months ended June 30, 2024. GAAP Gross Profit: GAAP gross profit for the six months ended June 30, 2025 was $15.9 million, an increase of $12.9 million, or 420%, from $3.0 million in GAAP gross profit for the six months ended June 30, 2024, with the increase due primarily to a higher margin annealing quantum computer system sale during the six months ended June 30, 2025. GAAP Gross Margin: GAAP gross margin for the six months ended June 30, 2025 was 87.6%, an increase of 22.0% from the 65.6% GAAP gross margin for the six months ended June 30, 2024, with the increase due primarily to a higher margin annealing quantum computer system sale during the six months ended June 30, 2025. Non-GAAP Gross Profit 2: Non-GAAP Gross Profit for the six months ended June 30, 2025 was $16.3 million, an increase of $12.8 million, or 367%, from the Non-GAAP Gross Profit of $3.5 million for the six months ended June 30, 2024. The difference between GAAP and Non-GAAP Gross Profit is limited to non-cash stock-based compensation and depreciation and amortization expenses that are excluded from the Non-GAAP Gross Profit. Non-GAAP Gross Margin 2: Non-GAAP Gross Margin for the six months ended June 30, 2025 was 89.9%, an increase of 14.9% from the 75.0% Non-GAAP Gross Margin for the six months ended June 30, 2024. The difference between GAAP and Non-GAAP Gross Margin is limited to non-cash stock-based compensation and depreciation and amortization expenses that are excluded from the Non-GAAP Gross Margin. GAAP Operating Expenses: GAAP operating expenses for the six months ended June 30, 2025 were $53.6 million, an increase of $14.2 million, or 36%, from GAAP operating expenses of $39.4 million for the six months ended June 30, 2024, with the year-over-year increase primarily driven by increases of $6.6 million in salaries and related personnel costs, 80% of which relates to increases in Sales & Marketing and Research & Development staff; $2.9 million in non-cash stock-based compensation; $2.0 million in fabrication and related activities; $1.8 million in third party professional services and $1.3 million in marketing expenses. The increased operating expenses stem from incremental investments to support the Company's continued growth and expansion. Non-GAAP Adjusted Operating Expenses 2: Non-GAAP Adjusted Operating Expenses for the six months ended June 30, 2025 were $42.4 million, an increase of $12.1 million, or 40%, from Non-GAAP Adjusted Operating Expenses of $30.3 million for the six months ended June 30, 2024, with the difference between GAAP and Non-GAAP Operating Expenses being primarily non-cash stock-based compensation expense, non-recurring one-time expenses, and depreciation and amortization. Net Loss: Net loss for the six months ended June 30, 2025 was $172.8 million, or $0.59 per share, an increase of $137.7 million, or $0.38 per share, compared with a net loss of $35.1 million, or $0.21 per share for the six months ended June 30, 2024. The increase was primary due to $138.1 million in non-cash, non-operating charges related to the remeasurement of the Company's warrant liability, as well as realized losses stemming from warrant exercises. Adjusted Net Loss 2: Adjusted Net Loss for the six months ended June 30, 2025 was $34.6 million, or $0.12 per share, essentially flat compared with the Adjusted Net Loss of $34.6 million, or $0.21 per share for the six months ended June 30, 2024, with the difference between Net Loss and Adjusted Net Loss being non-cash, non-operating warrant related charges. Adjusted EBITDA Loss 2: The Adjusted EBITDA Loss for the six months ended June 30, 2025 was $26.1 million, a decrease of $0.7 million, or 3%, from the six months ended June 30, 2024 Adjusted EBITDA Loss of $26.8 million, with the improvement due primarily to higher gross profit, partly offset by increased operating expenses. 1 'Bookings' is an operating metric that is defined as customer orders received that are expected to generate net revenues in the future. We present the operational metric of Bookings because it reflects customers' demand for our products and services and to assist readers in analyzing our potential performance in future periods. 2"Non-GAAP Gross Profit", "Non-GAAP Gross Margin", "Non-GAAP Adjusted Operating Expenses", "Adjusted Net Loss", "Adjusted Net Loss per Share" and "Adjusted EBITDA Loss", are non-GAAP financial measures or metrics. Please see the discussion in the section 'Non-GAAP Financial Measures' and the reconciliations included at the end of this press release. Balance Sheet and Liquidity As of June 30, 2025, D-Wave's consolidated cash balance totaled a record $819.3 million, representing an over 1900% increase from the fiscal 2024 second quarter consolidated cash balance of $40.9 million, and a 169% increase from the immediately prior fiscal 2025 first quarter consolidated cash balance of $304.3 million. During the second quarter of fiscal 2025, the Company raised $400 million in gross proceeds from its fourth ATM equity offering program, $99.3 million in cash proceeds from the exercise of warrants, and $37.8 million in net proceeds from its Equity Line of Credit (ELOC) with Lincoln Park Capital Fund, LLC that fulfilled the $150 million commitment that was originally secured in June of 2022. D-Wave ended the second quarter of fiscal 2025 with a record $694.3 million in stockholders' equity. Earnings Conference Call D-Wave will host a conference call on Thursday, August 7, 2025, at 8:00 a.m. (Eastern Time), to discuss the Company's financial results and business outlook. The live dial-in number is 1-800-717-1738 (domestic) or 1-646-307-1865 (international). Participants can use those dial-in numbers or can click this link for instant telephone access to the event. The link will be made active 15 minutes prior to the call's scheduled start time. An on-demand webcast will be available on the D-Wave Investor Relations website after the call. Participating in the call will be Chief Executive Officer Dr. Alan Baratz and Chief Financial Officer John Markovich. About D-Wave Quantum Inc. D-Wave is a leader in the development and delivery of quantum computing systems, software, and services. We are the world's first commercial supplier of quantum computers, and the only company building both annealing and gate-model quantum computers. Our mission is to help customers realize the value of quantum, today. Our quantum computers — the world's largest — feature QPUs with sub-second response times and can be deployed on-premises or accessed through our quantum cloud service, which offers 99.9% availability and uptime. More than 100 organizations trust D-Wave with their toughest computational challenges. With over 200 million problems submitted to our quantum systems to date, our customers apply our technology to address use cases spanning optimization, artificial intelligence, research and more. Learn more about realizing the value of quantum computing today and how we're shaping the quantum-driven industrial and societal advancements of tomorrow: Non-GAAP Financial Measures To supplement the financial information presented in accordance with GAAP, we use non-GAAP measures of certain components of financial performance. Each of Non-GAAP Gross Profit, Non-GAAP Gross Margin, Adjusted EBITDA Loss, Adjusted Net Loss, Adjusted Net Loss per Share and Non-GAAP Adjusted Operating Expenses is a financial measure that is not required by or presented in accordance with GAAP. Management believes that each measure provides investors an additional meaningful method to evaluate certain aspects of such results period over period. The Company defines each of its non-GAAP financial measures as follows: Non-GAAP Gross Profit is defined as GAAP gross profit less non-cash stock-based compensation expense and depreciation and amortization expense. We use Non-GAAP Gross Profit to measure, understand and evaluate our core operating performance and trends and to develop short-term and long-term operating plans. Non-GAAP Gross Margin is defined as GAAP gross margin less non-cash stock-based compensation expense. We use Non-GAAP Gross Margin to measure, understand and evaluate our core business performance. Adjusted EBITDA Loss is defined as net loss before interest expense, income tax expense (benefit), depreciation and amortization expense, stock-based compensation, remeasurements of liability-classified warrants, and other non-recurring non-operating income and expenses. We use Adjusted EBITDA Loss to measure the operating performance of our business, excluding specifically identified items that we do not believe directly reflect our core operations and may not be indicative of our recurring operations. Adjusted Net Loss and Adjusted Net Loss per Share are defined as net loss and net loss per share excluding the impact of the non-cash, non-operating charges associated with the remeasurement of the Company's warrant liability. Non-GAAP Adjusted Operating Expenses is defined as operating expenses before depreciation and amortization expense, non-recurring one-time expenses and non-cash stock-based compensation expense. We use Non-GAAP Adjusted Operating expenses to measure our operating expenses, excluding items we do not believe directly reflect our core operations. The presentation of non-GAAP financial measures is not meant to be considered in isolation or as a substitute for the financial results prepared in accordance with GAAP, and our presentation of non-GAAP measures may be different from non-GAAP measures used by other companies. For a reconciliation of each of Non-GAAP Gross Profit, Non-GAAP Gross Margin, Adjusted EBITDA Loss, Adjusted Net Loss, Adjusted Net Loss per Share and Non-GAAP Adjusted Operating Expenses to its most directly comparable GAAP measure, please refer to the reconciliations below. Forward Looking Statements Certain statements in this press release are forward-looking, as defined in the Private Securities Litigation Reform Act of 1995. These statements involve risks, uncertainties, and other factors that may cause actual results to differ materially from the information expressed or implied by these forward-looking statements and may not be indicative of future results. These forward-looking statements are subject to a number of risks and uncertainties, including, among others, various factors beyond management's control, including the risks set forth under the heading 'Risk Factors' discussed under the caption 'Item 1A. Risk Factors' in Part I of our most recent Annual Report on Form 10-K or any updates discussed under the caption 'Item 1A. Risk Factors' in Part II of our Quarterly Reports on Form 10-Q and in our other filings with the SEC. Undue reliance should not be placed on the forward-looking statements in this press release in making an investment decision, which are based on information available to us on the date hereof. We undertake no duty to update this information unless required by law. June 30, December 31, (In thousands, except share and per share data) 2025 2024 Assets Current assets: Cash and cash equivalents $ 819,312 $ 177,980 Trade accounts receivable, net of allowance for doubtful accounts of $1 and $176 1,442 1,420 Inventories 2,448 1,686 Prepaid expenses and other current assets 5,338 3,954 Total current assets 828,540 185,040 Property and equipment, net 4,504 4,133 Operating lease right-of-use assets 6,915 7,261 Intangible assets, net 586 490 Other non-current assets, net 3,057 2,929 Total assets $ 843,602 $ 199,853 Liabilities and stockholders' equity Current liabilities: Trade accounts payable $ 1,190 $ 815 Accrued expenses and other current liabilities 11,582 8,784 Current portion of operating lease liabilities 1,596 1,512 Loans payable, net, current — 348 Deferred revenue, current 4,906 18,686 Total current liabilities 19,274 30,145 Warrant liabilities 91,037 69,875 Operating lease liabilities, net of current portion 6,322 6,389 Loans payable, net, non-current 32,061 30,128 Deferred revenue, non-current 654 670 Total liabilities $ 149,348 $ 137,207 Commitments and contingencies Stockholders' equity: Common stock, par value $0.0001 per share; 675,000,000 shares authorized at both June 30, 2025 and December 31, 2024; 339,837,650 shares and 266,595,867 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively. 33 27 Additional paid-in capital 1,503,136 700,069 Accumulated deficit (799,690 ) (626,940 ) Accumulated other comprehensive loss (9,225 ) (10,510 ) Total stockholders' equity 694,254 62,646 Total liabilities and stockholders' equity $ 843,602 $ 199,853 Three Months Ended June 30, Six Months Ended June 30, (In thousands, except share and per share data) 2025 2024 2025 2024 Revenue $ 3,095 $ 2,183 $ 18,096 $ 4,648 Cost of revenue 1,119 795 2,243 1,601 Total gross profit 1,976 1,388 15,853 3,047 Operating expenses: Research and development 12,694 8,355 22,982 16,880 General and administrative 9,151 7,471 17,108 15,037 Sales and marketing 6,633 4,401 13,556 7,485 Total operating expenses 28,478 20,227 53,646 39,402 Loss from operations (26,502 ) (18,839 ) (37,793 ) (36,355 ) Other income (expense), net: Interest expense (206 ) (1,160 ) (432 ) (2,300 ) Change in fair value of Term Loan — (275 ) — 924 Gain (loss) on investment in marketable securities — (157 ) — 1,503 Change in fair value of warrant liabilities (142,048 ) 2,195 (138,105 ) (457 ) Other income (expense), net 1,427 458 3,580 1,595 Total other income (expense), net (140,827 ) 1,061 (134,957 ) 1,265 Net loss $ (167,329 ) $ (17,778 ) $ (172,750 ) $ (35,090 ) Net loss per share, basic and diluted $ (0.55 ) $ (0.10 ) $ (0.59 ) $ (0.21 ) Weighted-average shares used in computing net loss per share, basic and diluted 302,288,793 172,139,085 294,398,419 166,723,787 Comprehensive loss: Net loss $ (167,329 ) $ (17,778 ) $ (172,750 ) $ (35,090 ) Foreign currency translation adjustment 787 22 1,285 69 Net comprehensive loss $ (166,542 ) $ (17,756 ) $ (171,465 ) $ (35,021 ) D-Wave Quantum Inc. Condensed Consolidated Statements of Cash Flows (Unaudited) Six Months Ended June 30, (in thousands) 2025 2024 Cash flows from operating activities: Net loss $ (172,750 ) $ (35,090 ) Adjustments to reconcile net loss to cash used in operating activities: Depreciation and amortization 714 510 Stock-based compensation 10,664 7,730 Amortization of operating right-of-use assets 346 398 Non-cash interest expense 387 2,211 Change in fair value of Warrant liabilities 138,105 457 Change in fair value of Term Loan — (924 ) Gain on marketable securities — (1,503 ) Unrealized foreign exchange loss (gain) 1,998 (1,274 ) Other noncash items 267 — Change in operating assets and liabilities: Trade accounts receivable (57 ) 9 Inventories (762 ) (147 ) Prepaid expenses and other current assets (1,368 ) (339 ) Trade accounts payable 416 (502 ) Accrued expenses and other current liabilities 2,695 1,741 Deferred revenue (13,796 ) (125 ) Operating lease liability (344 ) 364 Other non-current assets, net (1,080 ) (103 ) Net cash used in operating activities (34,565 ) (26,587 ) Cash flows from investing activities: Purchase of property and equipment (1,187 ) (850 ) Purchase of convertible note — (1,000 ) Proceeds from recovery of previously written-off convertible receivable 959 — Sales of marketable equity securities — 254 Expenditures for internal-use software (129 ) (213 ) Net cash used in investing activities (357 ) (1,809 ) Cash flows from financing activities: Proceeds from the issuance of common stock pursuant to the Lincoln Park Purchase Agreement 37,787 20,288 Proceeds from the issuance of common stock in at-the-market offerings 536,741 9,100 Proceeds from issuance of common stock upon exercise of warrants 99,319 — Proceeds from the issuance of common stock upon exercise of stock options 6,860 43 Proceeds from common stock issued under the Employee Stock Purchase Plan 291 171 Payment of tax withheld pursuant to stock-based compensation settlements (5,664 ) (1,351 ) Repayments on TPC loan (365 ) (370 ) Net cash provided by financing activities 674,969 27,881 Effect of exchange rate changes on cash and cash equivalents 1,285 69 Net increase (decrease) in cash and cash equivalents 641,332 (446 ) Cash and cash equivalents at beginning of period 177,980 41,307 Cash and cash equivalents at end of period $ 819,312 $ 40,861 Three Months Ended June 30, Six Months Ended June 30, (in thousands of U.S. dollars) 2025 2024 2025 2024 Gross Profit $ 1,976 $ 1,388 $ 15,853 $ 3,047 Gross Margin 63.8 % 63.6 % 87.6 % 65.6 % Excluding: Depreciation and Amortization (1) 14 54 42 109 Stock-based compensation (2) 231 154 373 329 Non-GAAP Gross Profit $ 2,221 $ 1,596 $ 16,268 $ 3,485 Non-GAAP Gross Margin 71.8 % 73.1 % 89.9 % 75.0 % (1) Depreciation and Amortization reflects the Depreciation and Amortization recorded in Cost of Revenue only, which differs from the total Depreciation and Amortization set forth in the Condensed Consolidated Statement of Cash Flows that also includes Depreciation and Amortization recorded in Operating Expenses. (2) Stock-based compensation reflects the stock-based compensation recorded in Cost of Revenue only, which differs from the total stock-based compensation set forth in the Condensed Consolidated Statement of Cash flows that also includes stock-based compensation recorded in Operating Expenses. Three Months Ended June 30, Six Months Ended June 30, (in thousands of U.S. dollars) 2025 2024 2025 2024 Operating expenses $ 28,478 $ 20,227 $ 53,646 $ 39,402 Excluding: Depreciation and Amortization (1) (324 ) (227 ) (672 ) (401 ) Stock-based compensation (2) (6,440 ) (4,067 ) (10,291 ) (7,401 ) Other non-operating or non-recurring expenses (3) 506 (443 ) (304 ) (1,325 ) Non-GAAP Adjusted Operating Expenses $ 22,220 $ 15,490 $ 42,379 $ 30,275 (1) Depreciation and Amortization reflects the Depreciation and Amortization recorded in the Operating Expenses only, which differs from the total Depreciation and Amortization set forth in the Condensed Consolidated Statement of Cash Flows that also includes Depreciation and Amortization recorded in Cost of Revenue. (2) Stock-based compensation reflects the stock-based compensation recorded in Operating Expenses only, which differs from the total stock-based compensation set forth in the Condensed Consolidated Statement of Cash flows that also includes stock-based compensation recorded in Cost of Revenue. (3) Includes legal, consulting, and accounting fees arising from capital markets activities that are unrelated to the Company's core business operations, as well as non-recurring professional fees and credit loss expenses and recoveries. Three Months Ended June 30, Six Months Ended June 30, (in thousands of U.S. dollars) 2025 2024 2025 2024 Net loss $ (167,329 ) $ (17,778 ) $ (172,750 ) $ (35,090 ) Net loss per share (basic and diluted) $ (0.55 ) $ (0.10 ) $ (0.59 ) $ (0.21 ) Excluding: Change in fair value of warrant liabilities 142,048 (2,195 ) 138,105 457 Adjusted net loss $ (25,281 ) $ (19,973 ) $ (34,645 ) $ (34,633 ) Adjusted net loss per share (basic and diluted) $ (0.08 ) $ (0.12 ) $ (0.12 ) $ (0.21 ) D-Wave Quantum Inc. Reconciliation of Net Loss to Adjusted EBITDA Loss (Unaudited) Three Months Ended June 30, Six Months Ended June 30, (in thousands of U.S. dollars) 2025 2024 2025 2024 Net loss $ (167,329 ) $ (17,778 ) $ (172,750 ) $ (35,090 ) Excluding: Depreciation and Amortization 338 281 714 510 Stock-based compensation 6,671 4,221 10,664 7,730 Interest expense (1) 206 1,160 432 2,300 Change in fair value of warrant liabilities 142,048 (2,195 ) 138,105 457 Change in fair value of Term Loan — 275 — (924 ) Gain (loss) on investment in marketable securities — 157 — (1,503 ) Other (income) expense, net (2) (1,427 ) (458 ) (3,580 ) (1,595 ) Other non-operating or non-recurring items (3) (506 ) 443 304 1,325 Adjusted EBITDA Loss $ (19,999 ) $ (13,894 ) $ (26,111 ) $ (26,790 ) (1) Interest expense primarily reflects the paid-in-kind interest associated with the term loan agreement with PSPIB Unitas Investments II Inc. entered into on April 13, 2023 and fully repaid on October 22, 2024, and interest and adjustments to accrued interest on the SIF Loan. (2) Other income (expense), net consists primarily of foreign exchange gains and losses and interest income earned from cash and cash equivalents. (3) Includes legal, consulting, and accounting fees arising from capital markets activities that are unrelated to the Company's core business operations, as well as non-recurring professional fees and credit loss expenses and recoveries.
Globe and Mail
6 minutes ago
- Globe and Mail
Insulet Reports Second Quarter 2025 Revenue Increase of 32.9% Year-Over-Year (31.3% Constant Currency1)
Insulet Corporation (NASDAQ: PODD) (Insulet or the Company), the global leader in tubeless insulin pump technology with its Omnipod® brand of products, today announced financial results for the three months ended June 30, 2025. Second Quarter Financial Highlights: Revenue of $649.1 million, up 32.9%, or 31.3% in constant currency, exceeds the high end of the Company's guidance range of 26.0% in constant currency Total Omnipod revenue of $639.0 million, up 33.0%, or 31.4% in constant currency U.S. Omnipod revenue of $453.2 million, up 28.7% International Omnipod revenue of $185.8 million, up 45.0%, or 38.8% in constant currency Drug Delivery revenue of $10.2 million Gross margin of 69.7%, up 190 basis points over prior year Operating income of $121.1 million, or 18.7% of revenue, up 750 basis points over prior year Adjusted operating income 1 of $115.8 million, or 17.8% of revenue, up 670 basis points over prior year Net income of $22.5 million, or $0.32 per diluted share, compared with $188.6 million, or $2.59 per diluted share in prior year Adjusted net income 1 of $83.7 million, or $1.17 per diluted share, compared with $38.3 million, or $0.55 per diluted share in prior year Adjusted EBITDA 1 of $157.5 million, or 24.3% of revenue, up 570 basis points over prior year Recent Strategic Highlights: Announced Omnipod 5 App for iPhone compatible with Dexcom's G7 Continuous Glucose Monitor (CGM) sensor fully available in the U.S. Integrated Omnipod 5 with Dexcom's G7 CGM sensor in Germany and Abbott's FreeStyle Libre 2 Plus CGM sensor in Australia Collaborated with Marvel to launch comic book hero, Dyasonic, who lives with type 1 diabetes Presented strong clinical data at the American Diabetes Association (ADA) Scientific Session from the Company's SECURE-T2D and RADIANT trials, as well as real-world evidence of improved glycemic outcomes from more than 23,000 people with type 2 diabetes using Omnipod 5 in the U.S. Initiated redemption for remaining $380 million principal of convertible notes and refinanced Term Loan B Advanced sustainability across the Company, as detailed in Insulet's 2024 Sustainability Report 2 'We delivered robust second quarter results, reflecting our team's strong performance and the compelling impact and appeal of Omnipod 5 for people living with diabetes,' said Ashley McEvoy, President and CEO. 'Engaging with our partners, physicians, investors, and Podders this quarter has demonstrated our opportunity to revolutionize diabetes management and the value of our unique position at the nexus of consumer health, medtech, and health tech. As we scale the Company, I'm confident in our ability to grow and create value for all our stakeholders in the future.' 2025 Outlook: For the quarter ending September 30, 2025 and year ending December 31, 2025, the Company is providing the following guidance (revenue in constant currency): Conference Call: Insulet will host a conference call at 8:00 a.m. (Eastern Time) on August 7, 2025 to discuss the financial results and outlook. The link to the live call will be available on the Investor Relations section of the Company's website at 'Events and Presentations,' and will be archived for future reference. The live call may also be accessed by dialing (888) 770-7129 for domestic callers or (929) 203-2109 for international callers, passcode 5904836. About Insulet Corporation: Insulet Corporation (NASDAQ: PODD), headquartered in Massachusetts, is an innovative medical device company dedicated to simplifying life for people with diabetes and other conditions through its Omnipod product platform. The Omnipod Insulin Management System provides a unique alternative to traditional insulin delivery methods. With its simple, wearable design, the tubeless disposable Pod provides up to three days of non-stop insulin delivery, without the need to see or handle a needle. Insulet's flagship innovation, the Omnipod 5 Automated Insulin Delivery System, integrates with a continuous glucose monitor to manage blood sugar with no multiple daily injections, zero fingersticks, and can be controlled by a compatible personal smartphone in the U.S. or by the Omnipod 5 Controller. Insulet also leverages the unique design of its Pod by tailoring its Omnipod technology platform for the delivery of non-insulin subcutaneous drugs across other therapeutic areas. For more information, visit or Non-GAAP Measures: The Company uses the following non-GAAP financial measures: Constant currency revenue growth, which represents the change in revenue between current and prior year periods using the exchange rate in effect during the applicable prior year period. Insulet presents constant currency revenue growth because management believes it provides meaningful information regarding the Company's results on a consistent and comparable basis. Management uses this non-GAAP financial measure, in addition to financial measures in accordance with generally accepted accounting principles in the United States (GAAP), to evaluate the Company's operating results. It is also one of the performance metrics that determines management incentive compensation. Adjusted gross margin, adjusted gross margin as a percentage of revenue, adjusted operating income, adjusted operating income as a percentage of revenue, adjusted net income, and adjusted diluted earnings per share exclude the impact of certain significant transactions or events, such as legal settlements, medical device corrections, gains (losses) on investments and loss on extinguishment of debt, that affect the period-to-period comparability of the Company's performance, as applicable. Adjusted EBITDA, which represents net income plus net interest expense, income tax expense, depreciation and amortization, stock-based compensation expense and other significant transactions or events, such as legal settlements, medical device corrections, gains (losses) on investments and loss on extinguishment of debt, which affect the period-to-period comparability of the Company's performance, as applicable, and adjusted EBITDA as a percentage of revenue. Free cash flow, which is defined as net cash provided by operating activities less capital expenditures. Insulet presents the above non-GAAP financial measures because management uses them as supplemental measures in assessing the Company's performance, and the Company believes they are helpful to investors and other interested parties as measures of comparative performance from period to period. They also are commonly used measures in determining business value, and the Company uses them internally to report results. These non-GAAP financial measures should be considered supplemental to, and not a substitute for, the Company's reported financial results prepared in accordance with GAAP. Furthermore, the Company's definition of these non-GAAP measures may differ from similarly titled measures used by others. Because non-GAAP financial measures exclude the effect of items that will increase or decrease the Company's reported results of operations, Insulet strongly encourages investors to review the Company's consolidated financial statements and publicly filed reports in their entirety. Forward-Looking Statement: This press release contains forward-looking statements regarding, among other things, future operating and financial performance, product success and efficacy, the outcome of studies and trials, and the approval of products by regulatory bodies. These forward-looking statements are based on management's current beliefs, assumptions and estimates and are not intended to be a guarantee of future events or performance. If management's underlying assumptions turn out to be incorrect, or if certain risks or uncertainties materialize, actual results could vary materially from the expectations and projections expressed or implied by the forward-looking statements. Risks and uncertainties include, but are not limited to our dependence on a principal product platform; the impact of competitive products, technological change and product innovation; our ability to maintain an effective sales force and expand our distribution network; our ability to maintain and grow our customer base; our ability to scale the business to support revenue growth; our ability to secure and retain adequate coverage or reimbursement from third-party payors; the impact of healthcare reform laws; our ability to design, develop, manufacture and commercialize future products; unfavorable results of clinical studies, including issues with third parties conducting any studies, or future publication of articles or announcement of positions by diabetes associations or other organizations that are unfavorable; our ability to protect our intellectual property and other proprietary rights; potential conflicts with the intellectual property of third parties; our inability to maintain or enter into new license or other agreements with respect to continuous glucose monitors, data management systems or other rights necessary to sell our current product and/or commercialize future products; worldwide macroeconomic and geopolitical uncertainty, as well as risks associated with public health crises and pandemics, including government actions and restrictive measures implemented in response, supply chain disruptions, delays in clinical trials, and other impacts to the business, our customers, suppliers, and employees; international regulatory, commercial and logistics business risks, including the implementation of tariffs; the potential violation of anti-bribery/anti-corruption laws; the concentration of manufacturing operations and storage of inventory in a limited number of locations; supply problems or price fluctuations with sole source or third-party suppliers on which we are dependent; failure to retain key suppliers; challenges to the future development of our non-insulin drug delivery product line; our failure or that of our contract manufacturer or component suppliers to comply with the U.S. Food and Drug Administration's quality system regulations or other manufacturing difficulties; extensive government regulation applicable to medical devices, as well as complex and evolving privacy and data protection laws; our use of artificial intelligence tools; adverse regulatory or legal actions relating to current or future Omnipod products; potential adverse impacts resulting from a recall, or discovery of serious safety issues, or product liability lawsuits relating to off-label use; breaches or failures of our product or information technology systems, including by cyberattack; our ability to attract, motivate, and retain key personnel; risks associated with potential future acquisitions or investments in new businesses; ability to raise additional funds on acceptable terms or at all; the volatility of the trading price of our common stock; and changes in tax laws or exposure to significant tax liabilities. For a further list and description of these and other important risks and uncertainties that may affect the Company's future operations, see Part I, Item 1A - Risk Factors in our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission, which the Company may update in Part II, Item 1A - Risk Factors in Quarterly Reports on Form 10-Q the Company has filed or will file hereafter. Any forward-looking statement made in this release speaks only as of the date of this release. Insulet does not undertake to update any forward-looking statement, other than as required by law. ©2025 Insulet Corporation. Omnipod is a registered trademark of Insulet Corporation. All rights reserved. Three Months Ended June 30, Six Months Ended June 30, (dollars in millions, except per share data) 2025 2024 2025 2024 Revenue $ 649.1 $ 488.5 $ 1,218.1 $ 930.2 Cost of revenue 196.9 157.6 356.8 292.5 Gross profit 452.2 330.9 861.3 637.7 Research and development expenses 73.4 53.9 133.0 104.1 Selling, general and administrative expenses 257.7 222.5 518.4 422.2 Operating income 121.1 54.5 209.9 111.5 Interest expense, net (9.5 ) (1.7 ) (8.5 ) (3.0 ) Loss on extinguishment of debt (84.4 ) — (123.9 ) — Other income (expense), net 1.3 (1.8 ) (0.9 ) (2.5 ) Income before income taxes 28.4 51.1 76.5 106.0 Income tax (expense) benefit (5.9 ) 137.5 (18.6 ) 134.1 Net income $ 22.5 $ 188.6 $ 57.9 $ 240.1 Earnings per share: Basic $ 0.32 $ 2.69 $ 0.82 $ 3.43 Diluted $ 0.32 $ 2.59 $ 0.82 $ 3.32 Weighted-average number of common shares outstanding (in thousands): Basic 70,389 70,062 70,330 70,010 Diluted 70,652 73,802 70,641 73,771 Three Months Ended June 30, Six Months Ended June 30, (in millions) 2025 2024 2025 2024 Net income $ 22.5 $ 188.6 $ 57.9 $ 240.1 Add back interest expense, net of tax attributable to assumed conversion of convertible notes — 2.5 — 4.9 Net income, diluted $ 22.5 $ 191.1 $ 57.9 $ 245.0 Note: May not add or recalculate due to rounding. INSULET CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (dollars in millions) June 30, 2025 December 31, 2024 ASSETS Cash and cash equivalents $ 1,121.6 $ 953.4 Accounts receivable, net 444.5 365.5 Inventories 446.9 430.4 Prepaid expenses and other current assets 266.7 142.0 Total current assets 2,279.7 1,891.3 Property, plant and equipment, net 720.4 723.1 Other intangible assets, net 102.3 98.5 Goodwill 51.7 51.5 Other assets 315.1 323.3 Total assets $ 3,469.2 $ 3,087.7 LIABILITIES AND STOCKHOLDERS' EQUITY Accounts payable $ 96.1 $ 19.8 Accrued expenses and other current liabilities 453.4 424.9 Current portion of long-term debt 460.7 83.8 Total current liabilities 1,010.1 528.4 Long-term debt, net 939.0 1,296.1 Other liabilities 57.1 51.7 Total liabilities 2,006.3 1,876.1 Stockholders' equity 1,462.9 1,211.6 Total liabilities and stockholders' equity $ 3,469.2 $ 3,087.7 Note: May not add due to rounding. INSULET CORPORATION Three Months Ended June 30, (dollars in millions) 2025 2024 Percent Change Currency Impact Constant Currency U.S. $ 453.2 $ 352.3 28.7 % — % 28.7 % International 185.8 128.2 45.0 % 6.2 % 38.8 % Total Omnipod Products 639.0 480.4 33.0 % 1.6 % 31.4 % Drug Delivery 10.2 8.1 25.7 % — % 25.7 % Total $ 649.1 $ 488.5 32.9 % 1.6 % 31.3 % Six Months Ended June 30, (dollars in millions) 2025 2024 Percent Change Currency Impact Constant Currency U.S. $ 854.9 $ 670.0 27.6 % — % 27.6 % International 338.1 243.4 38.9 % 1.4 % 37.5 % Total Omnipod Products 1,193.0 913.4 30.6 % 0.4 % 30.2 % Drug Delivery 25.1 16.8 49.2 % — % 49.2 % Total $ 1,218.1 $ 930.2 30.9 % 0.4 % 30.6 % Note: Columns and rows may not add due to rounding. Percentages have been calculated using actual, non-rounded figures and, therefore, may not recalculate precisely. ADJUSTED OPERATING INCOME, NET INCOME & DILUTED EPS Three Months Ended June 30, 2025 (in millions, except per share data) Operating Income Percent of Revenue Income before Income Taxes Net Income (4) Net Income, Diluted Diluted Earnings per Share Effective Tax Rates GAAP $ 121.1 18.7 % $ 28.4 $ 22.5 $ 22.5 $ 0.32 20.8 % CEO transition costs (1) (5.3 ) (5.3 ) (5.5 ) (5.5 ) $ (0.08 ) Loss on extinguishment of debt (2) — 84.4 84.1 84.1 $ 1.16 Tax matters (3) — — (17.3 ) (17.3 ) $ (0.24 ) Interest expense, net of tax attributable to assumed conversion of convertible notes — — — 1.2 $ 0.02 Non-GAAP $ 115.8 17.8 % $ 107.5 $ 83.7 $ 85.0 $ 1.17 22.1 % Six Months Ended June 30, 2025 (in millions, except per share data) Operating Income Percent of Revenue Income before Income Taxes Net Income (4) Net Income, Diluted Diluted Earnings per Share Effective Tax Rates GAAP $ 209.9 17.2 % $ 76.5 $ 57.9 $ 57.9 $ 0.82 24.3 % CEO transition costs (1) (5.3 ) (5.3 ) (5.5 ) (5.5 ) $ (0.07 ) Loss on investments (5) 4.7 7.5 5.8 5.8 $ 0.08 Loss on extinguishment of debt (2) — 123.9 123.0 123.0 $ 1.68 Tax matters (3) — — (23.8 ) (23.8 ) $ (0.32 ) Interest expense, net of tax attributable to assumed conversion of convertible notes — — — 2.9 $ 0.04 Non-GAAP $ 209.2 17.2 % $ 202.6 $ 157.4 $ 160.3 $ 2.19 22.3 % (1) Relates to the forfeiture of equity awards by the Company's former Chief Executive Officer, net of severance benefits. (2) Relates to the repurchase of a portion of the Company's convertible debt. (3) Primarily represents consolidating effective tax rate adjustment related to non-GAAP items and excess tax benefits related to employee share-based compensation. (4) The tax effect on non-GAAP adjustments is calculated based on applicable local statutory rates. (5) Represents a provision for credit loss included in selling, general and administrative expenses related to a debt investment and an impairment included in other expense related to an equity investment. DILUTED SHARES (in thousands) Three Months Ended June 30, 2025 Six Months Ended June 30, 2025 GAAP weighted average number of common shares outstanding, diluted 70,652 70,641 Convertible notes 1,862 2,671 Non-GAAP weighted average number of common shares outstanding, diluted 72,514 73,312 Note: Columns and rows may not add due to rounding or the difference in diluted shares on a GAAP and non-GAAP basis. Percentages have been calculated using actual, non-rounded figures and, therefore, may not recalculate precisely. INSULET CORPORATION Three Months Ended June 30, 2024 (dollars in millions) Income before Income Taxes Net Income (3) Net Income, Diluted Diluted Earnings per Share Effective Tax Rate GAAP $ 51.1 $ 188.6 $ 191.1 $ 2.59 (269.3 )% Loss on investments (1) 1.8 1.4 1.4 0.02 Tax matters (2) — (151.7 ) (151.7 ) (2.06 ) Non-GAAP $ 52.8 $ 38.3 $ 40.8 $ 0.55 27.6 % Six Months Ended June 30, 2024 (dollars in millions) Income before Income Taxes Net Income (3) Net Income, Diluted Diluted Earnings per Share Effective Tax Rate GAAP $ 106.0 $ 240.1 $ 245.0 $ 3.32 (126.6 )% Loss on investments (1) 1.8 1.4 1.4 0.02 Tax matters (2) — (158.3 ) (158.3 ) (2.15 ) Non-GAAP $ 107.7 $ 83.2 $ 88.2 $ 1.19 22.8 % (1) Represents non-operating loss resulting from the fair value adjustment of a strategic debt investment. (2) Includes tax benefit of $146.9 million and $153.5 million for the three and six months ended June 30, 2024, respectively, resulting from the release of the majority of the Company's income tax valuation allowance. Both periods also include a $4.8 million tax benefit related to a research and development tax credit recovery project for tax years 2017 through 2021. (3) The tax effect on non-GAAP adjustments is calculated based on applicable local statutory rates. Note: Columns and rows may not add due to rounding. Percentages have been calculated using actual, non-rounded figures and, therefore, may not recalculate precisely. ADJUSTED EBITDA Three Months Ended June 30, Six Months Ended June 30, (dollars in millions) 2025 Percent of Revenue 2024 Percent of Revenue 2025 Percent of Revenue 2024 Percent of Revenue Net income $ 22.5 3.5 % $ 188.6 38.6 % $ 57.9 4.8 % $ 240.1 25.8 % Interest expense, net 9.5 1.7 8.5 3.0 Income tax expense (benefit) 5.9 (137.5 ) 18.6 (134.1 ) Depreciation and amortization 22.3 19.3 44.0 38.0 Stock-based compensation expense (1) 7.5 17.0 25.7 31.2 CEO transition (2) 5.4 — 5.4 — Loss on extinguishment of debt (3) 84.4 — 123.9 — Loss on investments (4) — 1.8 7.5 1.8 Adjusted EBITDA $ 157.5 24.3 % $ 90.9 18.6 % $ 291.5 23.9 % $ 180.0 19.4 % (1) Amounts for both the three and six months ended June 30, 2025 includes $10.8 million reversal of stock-based compensation expense associated with the departure of the Company's former Chief Executive Officer (CEO). (2) Represents severance expense related to the departure of the Company's former CEO. (3) Relates to the repurchase of a portion of the Company's convertible debt. (4) Represents losses associated with debt and equity investments. FREE CASH FLOW (in millions) Six Months Ended June 30, 2025 Net cash provided by operating activities $ 260.3 Capital expenditures (30.9 ) Free cash flow $ 229.4 Note: Columns may not add due to rounding. Percentages have been calculated using actual, non-rounded figures and, therefore, may not recalculate precisely. INSULET CORPORATION Year Ending December 31, 2025 U.S. Omnipod 22% - 25% —% 22% - 25% International Omnipod 37% - 40% 3% 34% - 37% Total Omnipod 26% - 29% 1% 25% - 28% Drug Delivery (30)% - (25)% —% (30)% - (25)% Total 25% - 28% 1% 24% - 27% Three Months Ended September 30, 2025 Revenue Growth GAAP Currency Impact Constant Currency U.S. Omnipod 21% - 24% —% 21% - 24% International Omnipod 36% - 39% 3% 33% - 36% Total Omnipod 25% - 28% 1% 24% - 27% Drug Delivery (80)% - (75)% —% (80)% - (75)% Total 23% - 26% 1% 22% - 25%
Globe and Mail
6 minutes ago
- Globe and Mail
Pagaya Reports Second Quarter and First Half 2025 Results
Pagaya Technologies Ltd. (NASDAQ: PGY) ('Pagaya', the 'Company' or 'we'), a global technology company delivering artificial intelligence infrastructure for the financial ecosystem, today announced financial results for the second quarter and the first half of 2025. For additional information, view Pagaya's second quarter 2025 letter to shareholders here. Third Quarter 2025 Outlook 3Q25 Network Volume Expected to be between $2.75 billion and $2.95 billion Total Revenue and Other Income Expected to be between $330 million and $350 million Adjusted EBITDA Expected to be between $90 million and $100 million GAAP Net Income* Expected to be between $10 million and $20 million Full Year 2025 Outlook FY25 Network Volume Expected to be between $10.5 billion and $11.5 billion Total Revenue and Other Income Expected to be between $1.25 billion and $1.325 billion Adjusted EBITDA Expected to be between $345 million and $370 million GAAP Net Income* Expected to be between $55 million and $75 million *Our third quarter and full-year 2025 GAAP net income guidance includes the impact of several one-time items, the combined impact of which is expected to be a net loss of approximately $5 - $10 million for the quarter. This includes approximately $24 million in costs associated with the issuance of our corporate bond, along with costs associated with the early retirement of existing debt. Partially offsetting this loss, we expect to record a one-time benefit associated with the resolution of certain tax-related matters. 'Our results reflect continued disciplined execution across our network of lending and funding partners. Through the combination of our increasingly diversified sources of revenue, our scalable operating model, and our proprietary data advantage, Pagaya continues to create a unique category with the goal to bridge Wall Street and Main Street for the long term,' said Gal Krubiner, CEO and Co-Founder. Second Quarter 2025 Highlights All comparisons are made versus the same period in 2024 and on a year-over-year basis unless otherwise stated. Record GAAP net income attributable to Pagaya shareholders of $17 million (exceeding outlook of breakeven to $10 million) increased by $91 million year-over-year, driven primarily by revenue growth and lower expenses. Record network volume of $2.6 billion (exceeding outlook of $2.3 to $2.5 billion) increased by 14% year-over-year, driven by growth in our Auto and Point-of-Sale verticals and maintaining our focus on prudent underwriting. Record total revenue and other income of $326 million (exceeding outlook of $290 to $310 million) increased by 30% year-over-year. Record Revenue from fees less production costs ('FRLPC') of $126 million increased by 30% year-over-year, driven by improved economics in our personal loan and auto verticals. Record adjusted EBITDA of $86 million (versus guidance of $75 to $90 million) increased by $36 million compared to the prior year period, benefiting from growth in FRLPC and operating leverage as the business scales. Adjusted net income of $51 million, which excludes the impact of non-cash items such as share-based compensation expense. The Company raised $2.3 billion across 6 ABS transactions in Q2, a quarterly record, and expanded its funding network by 10 new investors, for a total of 145 funding partners, with additional 2 transactions executed so far in Q3. The Company issued its first AAA-rated $300 million Auto ABS securitization, a testament to the consistent performance and scaled production of our Auto business. Inaugural AAA-rated $300 million POSH Point-of-Sale ABS securitization providing more than $1 billion in total funding capacity over the next 12 months. The Company announced a new forward flow agreement with Castlelake in July to purchase up to $2.5 billion in Personal Loans over 16 months, raising capacity across forward flow partnerships and pass-throughs to ~$5 billion since the end of 2024. Webcast The Company will hold a webcast and conference call today, August 7, 2025, at 8:30 a.m. Eastern Time. A live webcast of the call will be available via the Investor Relations section of the Company's website at To listen to the live webcast, please go to the site at least five minutes prior to the scheduled start time in order to register, download and install any necessary audio software. Shortly before the call, the accompanying materials will be made available on the Company's website. Shortly after the call, a replay of the webcast will be available for 90 days on the Company's website. The conference call can also be accessed by dialing 1-833-316-2483 or 1-785-838-9284 and providing conference ID PAGAYA. The telephone replay can be accessed by dialing 1-844-512-2921 or 1-412-317-6671 and providing the conference ID# 11159561. The telephone replay will be available starting shortly after the call until Thursday, August 21, 2025. A replay will also be available on the Investor Relations website following the call. About Pagaya Technologies Pagaya (NASDAQ: PGY) is a global technology company making life-changing financial products and services available to more people nationwide. By using machine learning, a vast data network and an AI-driven approach, Pagaya provides comprehensive consumer credit and residential real estate solutions for its partners, their customers, and investors. Its proprietary API and capital solutions integrate into its network of partners to deliver seamless user experiences and greater access to the mainstream economy. Pagaya has offices in New York and Tel Aviv. For more information, visit Cautionary Note About Forward-Looking Statements This document 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, that involve risks and uncertainties. These forward-looking statements generally are identified by the words 'anticipate,' 'believe,' 'continue,' 'can,' 'could,' 'estimate,' 'expect,' 'intend,' 'may,' 'opportunity,' 'future,' 'strategy,' 'might,' 'outlook,' 'plan,' 'possible,' 'potential,' 'predict,' 'project,' 'should,' 'strive,' 'will,' 'would,' 'will be,' 'will continue,' 'will likely result,' and similar expressions. All statements other than statements of historical fact are forward-looking statements, including statements regarding: The Company's strategy and future operations, including the Company's ability to continue to deliver consistent results for its lending partners and investors; the Company's ability to continue to drive sustainable gains in profitability; the Company's ability to achieve continued momentum in its business; the Company's ability to maintain positive net cash flow; and the Company's financial outlook for Network Volume, Total Revenue and Other Income, Net Income and Adjusted EBITDA for the third quarter and full year 2025. These forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause the Company's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Risks, uncertainties and assumptions include factors relating to: the Company's ability to attract new partners and to retain and grow its relationships with existing partners to support the underlying investment needs for its securitizations and funds products; the need to maintain a consistently high level of trust in its brand; the concentration of a large percentage of its investment revenue with a small number of partners and platforms; its ability to sustain its revenue growth rate or the growth rate of its related key operating metrics; its ability to improve, operate and implement its technology, its existing funding arrangements for the Company and its affiliates that may not be renewed or replaced or its existing funding sources that may be unwilling or unable to provide funding to it on terms acceptable to it, or at all; the performance of loans facilitated through its model; changes in market interest rates; its securitizations, warehouse credit facility agreements; the impact on its business of general economic conditions, including, but not limited to rising interest rates, inflation, supply chain disruptions, exchange rate fluctuations and labor shortages; the effect of and uncertainties related to public health crises such as the COVID-19 pandemic (including any government responses thereto); geopolitical conflicts such as the war in Israel; its ability to realize the potential benefits of past or future acquisitions; anticipated benefits and savings from our recently announced reduction in workforce; changes in the political, legal and regulatory framework for AI technology, machine learning, financial institutions and consumer protection; the ability to maintain the listing of our securities on Nasdaq; the financial performance of its partners, and fluctuations in the U.S. consumer credit and housing market; its ability to grow effectively through strategic alliances; seasonal fluctuations in our revenue as a result of consumer spending and saving patterns; pending and future litigation, regulatory actions and/or compliance issues including with respect to the merger with EJF Acquisition Corp.; and other risks that are described in the Company's Form 10-K filed on March 12, 2025 and subsequent filings with the U.S. Securities and Exchange Commission. These forward-looking statements reflect the Company's views with respect to future events as of the date hereof and are based on assumptions and subject to risks and uncertainties. Given these uncertainties, investors should not place undue reliance on these forward-looking statements. The forward-looking statements are made as of the date hereof, reflect the Company's current beliefs and are based on information currently available as of the date they are made, and the Company assumes no obligation and does not intend to update these forward-looking statements. Financial Information; Non-GAAP Financial Measures Some of the unaudited financial information and data contained in this press release and Form 8-K, such as Fee Revenue Less Production Costs ('FRLPC'), Adjusted EBITDA and Adjusted Net Income, have not been prepared in accordance with United States generally accepted accounting principles ('U.S. GAAP'). To supplement the unaudited consolidated financial statements prepared and presented in accordance with U.S. GAAP, management uses the non-GAAP financial measures FRLPC, Adjusted Net Income and Adjusted EBITDA to provide investors with additional information about our financial performance and to enhance the overall understanding of the results of operations by highlighting the results from ongoing operations and the underlying profitability of our business. Management believes these non-GAAP measures provide an additional tool for investors to use in comparing our core financial performance over multiple periods. However, non-GAAP financial measures have limitations in their usefulness to investors because they have no standardized meaning prescribed by U.S. GAAP and are not prepared under any comprehensive set of accounting rules or principles. In addition, non-GAAP financial measures may be calculated differently from, and therefore may not be directly comparable to, similarly titled measures used by other companies. As a result, non-GAAP financial measures should be viewed as supplementing, and not as an alternative or substitute for, our unaudited consolidated financial statements prepared and presented in accordance with U.S. GAAP. To address these limitations, management provides a reconciliation of Adjusted Net Income and Adjusted EBITDA to net income (loss) attributable to Pagaya's shareholders and FRLPC to operating income. Management encourages investors and others to review our financial information in its entirety, not to rely on any single financial measure and to view Adjusted Net Income and Adjusted EBITDA in conjunction with its respective related GAAP financial measures. Non-GAAP financial measures include the following items: Fee Revenue Less Production Costs ('FRLPC') is defined as revenue from fees less production costs. Adjusted Net Income (Loss) is defined as net income (loss) attributable to Pagaya Technologies Ltd.'s shareholders excluding share-based compensation expense, change in fair value of warrant liability, change in fair value of contingent liability, impairment, including credit-related charges, restructuring expenses, transaction-related expenses, and non-recurring expenses associated with mergers and acquisitions. Adjusted EBITDA is defined as net income (loss) attributable to Pagaya Technologies Ltd.'s shareholders excluding share-based compensation expense, change in fair value of warrant liability, change in fair value of contingent liability, impairment, including credit-related charges, restructuring expenses, transaction-related expenses, non-recurring expenses associated with mergers and acquisitions, interest expense, depreciation expense, and income tax expense (benefit). These items are excluded from our Adjusted Net Income (Loss) and Adjusted EBITDA measures because they are noncash in nature, or because the amount and timing of these items is unpredictable, is not driven by core results of operations and renders comparisons with prior periods and competitors less meaningful. We believe FRLPC, Adjusted Net Income (Loss) and Adjusted EBITDA provide useful information to investors and others in understanding and evaluating our results of operations, as well as providing a useful measure for period-to-period comparisons of our business performance. Moreover, we have included FRLPC, Adjusted Net Income (Loss) and Adjusted EBITDA because these are key measurements used by our management internally to make operating decisions, including those related to operating expenses, evaluate performance, and perform strategic planning and annual budgeting. However, this non-GAAP financial information is presented for supplemental informational purposes only, should not be considered a substitute for or superior to financial information presented in accordance with U.S. GAAP and may be different from similarly titled non-GAAP financial measures used by other companies. The tables below provide reconciliations of this non-GAAP financial information to its most directly comparable U.S. GAAP metric. In addition, Pagaya provides outlook for the third quarter of 2025 and the fiscal year 2025 on a non-GAAP basis. The Company cannot reconcile its expected Adjusted EBITDA to expected Net Loss Attributable to Pagaya under 'Full-Year 2025 Financial Outlook' without unreasonable effort because certain items that impact net income (loss) and other reconciling items are out of the Company's control and/or cannot be reasonably predicted at this time, which unavailable information could have a significant impact on the Company's U.S. GAAP financial results. Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Revenue Revenue from fees $ 317,714 $ 242,594 $ 600,418 $ 479,598 Other Income Interest income 10,739 8,193 18,415 15,937 Investment (loss) income, net (2,055 ) (443 ) (2,446 ) 85 Total Revenue and Other Income 326,398 250,344 616,387 495,620 Production costs 191,465 145,602 358,548 290,483 Technology, data and product development (1) 18,455 21,935 37,899 41,315 Sales and marketing (1) 19,660 13,331 29,254 23,588 General and administrative (1) 40,349 64,449 86,532 127,517 Total Costs and Operating Expenses 269,929 245,317 512,233 482,903 Operating Income 56,469 5,027 104,154 12,717 Other expense, net (34,928 ) (73,194 ) (82,661 ) (107,543 ) Income (Loss) Before Income Taxes 21,541 (68,167 ) 21,493 (94,826 ) Income tax expense 4,978 14,512 2,438 19,515 Net Income (Loss) Including Noncontrolling Interests 16,563 (82,679 ) 19,055 (114,341 ) Less: Net loss attributable to noncontrolling interests (92 ) (7,894 ) (5,493 ) (18,333 ) Net Income (Loss) Attributable to Pagaya Technologies Ltd. $ 16,655 $ (74,785 ) $ 24,548 $ (96,008 ) Per share data: Net income (loss) attributable to Pagaya Technologies Ltd. shareholders $ 16,655 $ (74,785 ) $ 24,548 $ (96,008 ) Less: Undistributed earnings allocated to preferred shares 1,017 — 1,509 — Net income (loss) attributable to Pagaya Technologies Ltd.'s ordinary shares $ 15,638 $ (74,785 ) $ 23,039 $ (96,008 ) Earnings (loss) per share attributable to Pagaya Technologies Ltd.'s ordinary shares: Basic $ 0.20 $ (1.04 ) $ 0.30 $ (1.41 ) Diluted $ 0.20 $ (1.04 ) $ 0.29 $ (1.41 ) Non-GAAP adjusted net income (2) $ 50,624 $ 7,188 $ 103,813 $ 20,519 Non-GAAP adjusted net income per share: Basic $ 0.66 $ 0.10 $ 1.36 $ 0.30 Diluted $ 0.64 $ 0.10 $ 1.33 $ 0.30 Weighted average shares outstanding: Basic 76,873,529 71,765,884 76,347,801 68,113,860 Diluted 79,667,635 73,002,689 78,301,110 69,485,741 (1) The following table sets forth share-based compensation for the periods indicated below: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Technology, data and product development $ 1,326 $ 3,069 $ 2,423 $ 5,974 Sales and marketing 8,731 3,867 13,511 6,719 General and administrative 8,171 11,108 15,466 20,826 Total $ 18,228 $ 18,044 $ 31,400 $ 33,519 (2) See 'Reconciliation of Non-GAAP Financial Measures.' June 30, December 31, 2025 2024 Assets Current assets: Cash and cash equivalents $ 182,986 $ 187,921 Restricted cash 23,845 18,595 Fees and other receivables (1) 118,475 97,932 Investments in loans and securities (1) 21,519 22,087 Prepaid expenses and other current assets 15,648 24,944 Total current assets 362,473 351,479 Non-current assets: Restricted cash 35,203 20,002 Fees and other receivables 30,709 29,182 Investments in loans and securities 848,542 756,322 Equity method and other investments 19,487 21,933 Right-of-use assets 33,726 36,876 Property and equipment, net 34,449 37,974 Goodwill 22,903 23,062 Intangible assets, net 10,521 12,821 Prepaid expenses and other assets 1,030 1,421 Total non-current assets 1,036,570 939,593 Total Assets $ 1,399,043 $ 1,291,072 Liabilities and Shareholders' Equity Current liabilities: Accounts payable $ 9,191 $ 6,992 Accrued expenses and other liabilities 39,882 45,362 Current maturities of operating lease liabilities 6,931 6,453 Current portion of long-term debt 17,750 17,750 Secured borrowing 165,416 109,079 Income taxes payable 15,303 9,858 Total current liabilities 254,473 195,494 Non-current liabilities: Warrant liability 2,471 893 Long-term debt 296,797 303,567 Exchangeable notes 147,526 146,342 Secured borrowing 100,141 67,010 Operating lease liabilities 29,153 30,611 Long-term tax and deferred tax liabilities, net 26,253 31,359 Total non-current liabilities 602,341 579,782 Total Liabilities 856,814 775,276 Redeemable convertible preferred shares 74,250 74,250 Shareholders' equity: Additional paid-in capital 1,319,312 1,282,022 Accumulated other comprehensive loss (33,065 ) (11,488 ) Accumulated deficit (919,495 ) (944,043 ) Total Pagaya Technologies Ltd. shareholders' equity 366,752 326,491 Noncontrolling interests 101,227 115,055 Total shareholders' equity 467,979 441,546 Total Liabilities, Redeemable Convertible Preferred Shares, and Shareholders' Equity $ 1,399,043 $ 1,291,072 (1) Accrued interest receivable of $14.3 million, previously reported within 'Fee and other receivables' as of December 31, 2024, has been reclassified to 'Investment in loans and securities' to conform to the current period's presentation. Six Months Ended June 30, 2025 2024 Cash flows from operating activities Net income (loss) including noncontrolling interests $ 19,055 $ (114,341 ) Adjustments to reconcile net income (loss) to net cash used in operating activities: Equity method loss (income) 2,446 (86 ) Depreciation and amortization 15,315 13,359 Share-based compensation 31,400 33,519 Fair value adjustment to warrant liability 1,578 (1,571 ) Impairment loss on investments in loans and securities, net (1) 54,605 80,046 Gain on sale of investments in loans and securities (8,690 ) — Amortization of deferred costs 5,843 1,250 Write-off of capitalized software — 2,561 Loss on foreign exchange 1,311 186 Change in operating assets and liabilities: Fees and other receivables (1) (22,132 ) (11,614 ) Accrued interest on investments (1) (15,246 ) (10,204 ) Prepaid expenses and other assets 9,628 998 Right-of-use assets 3,035 3,879 Accounts payable 2,108 6,071 Accrued expenses and other liabilities (5,842 ) 7,793 Operating lease liability (3,001 ) (3,205 ) Income taxes 364 18,363 Net cash provided by operating activities 91,777 27,004 Cash flows from investing activities Proceeds from the sale/maturity/prepayment of: Investments in loans and securities (1) 129,350 75,779 Acquisition of Theorem Technology, Inc., net of cash acquired 159 — Payments for the purchase of: Investments in loans and securities (274,125 ) (408,459 ) Property and equipment (7,576 ) (9,525 ) Equity method and other investments — (125 ) Net cash used in investing activities (152,192 ) (342,330 ) Cash flows from financing activities Proceeds from sale of ordinary shares, net of issuance costs — 89,956 Proceeds from long-term debt — 244,725 Proceeds from secured borrowing 244,894 207,317 Proceeds received from noncontrolling interests — 2,815 Proceeds from revolving credit facility — 44,000 Proceeds from exercise of stock options, warrants and contributions to ESPP 3,977 759 Proceeds from issuance of ordinary shares from the Equity Financing Purchase Agreement — 5,338 Distributions made to noncontrolling interests (8,420 ) (5,318 ) Payments made to revolving credit facility — (134,000 ) Payments made to secured borrowing (156,924 ) (78,809 ) Payments made to long-term debt (8,875 ) (6,375 ) Debt issuance costs — (7,974 ) Net cash provided by financing activities 74,652 362,434 Effect of exchange rate changes on cash, cash equivalents and restricted cash 1,279 (1,723 ) Net increase in cash, cash equivalents and restricted cash 15,516 45,385 Cash, cash equivalents and restricted cash, beginning of period 226,518 222,541 Cash, cash equivalents and restricted cash, end of period $ 242,034 $ 267,926 (1) Accrued interest receivable of $14.3 million, previously reported within 'Fee and other receivables' as of December 31, 2024, has been reclassified to 'Investment in loans and securities' to conform to the current period's presentation and six month ended June 30, 2024 amounts have been reclassified to conform to the current period presentation. Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Net Income (Loss) Attributable to Pagaya Technologies Ltd. $ 16,655 $ (74,785 ) $ 24,548 $ (96,008 ) Adjusted to exclude the following: Share-based compensation 18,228 18,044 31,400 33,519 Fair value adjustment to contingent liability (2,205 ) — (5,389 ) — Fair value adjustment to warrant liability 479 329 1,578 (1,571 ) Impairment loss on certain investments, net 15,011 58,179 44,522 77,662 Write-off of capitalized software — 2,561 — 2,561 Restructuring expenses 263 2,725 1,225 3,545 Transaction-related expenses 9 135 23 535 Non-recurring expenses 2,184 — 5,906 276 Adjusted Net Income $ 50,624 $ 7,188 $ 103,813 $ 20,519 Adjusted to exclude the following: Interest expenses 23,088 21,563 44,300 36,727 Income tax expenses 4,978 14,512 2,438 19,515 Depreciation and amortization 7,593 7,042 15,315 13,359 Adjusted EBITDA $ 86,283 $ 50,305 $ 165,866 $ 90,120 Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Operating Income $ 56,469 $ 5,027 $ 104,154 $ 12,717 Add: Technology, data and product development 18,455 21,935 37,899 41,315 Add: Sales and marketing 19,660 13,331 29,254 23,588 Add: General and administrative 40,349 64,449 86,532 127,517 Less: Interest income 10,739 8,193 18,415 15,937 Less: Investment (loss) income, net (2,055 ) (443 ) (2,446 ) 85 Fee Revenue Less Production Costs (FRLPC) $ 126,249 $ 96,992 $ 241,870 $ 189,115 Network Volume (in millions) 2,648 2,331 5,048 4,750
