bmtx-20240930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024


☐			Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

Commission file number 001-38633

BM Technologies, Inc.

(Exact name of registrant as specified in its charter)


Delaware									82-3410369
(State or other jurisdiction of incorporation or organization)									(I.R.S. Employer Identification No.)

201 King of Prussia Road, Suite 650
Wayne, Pennsylvania									19087
(Address of Principal Executive)									(Zip-Code)

(877) 327-9515

Registrant's telephone number, including area code

(Former name, former address, and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	BMTX	NYSE American LLC
Warrants, each whole warrant exercisable for one share of Common Stock at an exercise price of $11.50 per share	BMTX-WT	NYSE American LLC

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, non-accelerated filer, and emerging growth company in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). ☐

The registrant had issued and outstanding 12,099,490 shares of common stock, par value $0.0001 per share, as of November 14, 2024.

Table of Contents


			Page
Part I - Financial Information			2
Item 1. Unaudited Consolidated Financial Statements			2
Consolidated Balance Sheets at September 30, 2024 and December 31, 2023			2
Consolidated Statements of Loss for the Three and Nine Months Ended September 30, 2024 and 2023			3
Consolidated Statements of Changes in Shareholders' Equity for the Nine Months Ended September 30, 2024 and 2023			4
Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2024 and 2023			5
Notes to Unaudited Consolidated Financial Statements			6
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			22
Item 3. Quantitative and Qualitative Disclosures About Market Risk			30
Item 4. Controls and Procedures			30

Part II - Other Information			32
Item 1. Legal Proceedings			32
Item 1A. Risk Factors			32
Item 2. Unregistered Sales of Equity and Use of Proceeds			34
Item 3. Defaults Upon Senior Securities			34
Item 4. Mine Safety Disclosures			35
Item 5. Other Information			35
Item 6. Exhibits			36

Signatures			37

Part I - Financial Information

ITEM 1. UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

BM TECHNOLOGIES, INC.

CONSOLIDATED BALANCE SHEETS — UNAUDITED

(amounts in thousands, except share and per share data)


	September 30, 2024		December 31, 2023
ASSETS
Cash and cash equivalents	$	11,224	$	14,288
Accounts receivable, net allowance for doubtful accounts of $1,540 and $1,100	4,891		9,128
Prepaid expenses and other assets	2,314		5,148
Total current assets	18,429		28,564
Premises and equipment, net	430		535
Developed software, net	15,857		16,173
Goodwill	5,259		5,259
Other intangibles, net	3,869		4,109

Total assets	$	43,844	$	54,640
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Accounts payable and accrued liabilities	$	10,295	$	10,577
Deferred revenue, current	11,855		12,322
Total current liabilities	22,150		22,899
Non-current liabilities:
Deferred revenue, non-current	4		127
Liability for private warrants	162		162
Other non-current liabilities	—		480
Total liabilities	$	22,316	$	23,668
Commitments and contingencies (Note 7)
Shareholders’ equity:
Preferred stock: Par value $0.0001 per share; 10,000,000 shares authorized, zero shares issued or outstanding at both September 30, 2024 and December 31, 2023	$	—	$	—
Common stock: Par value $0.0001 per share; 1 billion shares authorized; 12,099,490 shares issued and outstanding at September 30, 2024; 11,984,133 shares issued and outstanding at December 31, 2023	1		1
Additional paid-in capital	71,421		71,787
Accumulated deficit	(49,894)		(40,816)
Total shareholders’ equity	$	21,528	$	30,972
Total liabilities and shareholders’ equity	$	43,844	$	54,640

See accompanying notes to the unaudited consolidated financial statements.

BM TECHNOLOGIES, INC.

CONSOLIDATED STATEMENTS OF LOSS — UNAUDITED

(amounts in thousands, except per share data)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Operating revenues:
Interchange and card revenue	$	2,990	$	2,292	$	8,689	$	6,716
Servicing fees	7,557		8,658		23,397		22,990
Account fees	1,680		1,931		5,580		5,981
University fees	1,712		1,412		4,793		4,291
Other revenue	138		88		340		415
Total operating revenues	14,077		14,381		42,799		40,393
Operating expenses:
Technology, communication, and processing	6,168		7,826		15,176		20,949
Salaries and employee benefits	5,590		4,773		15,697		17,337
Professional services	2,840		2,948		8,682		7,926
Provision for operating losses	2,650		2,138		6,827		5,628
Occupancy	11		9		37		33
Customer related supplies	242		227		714		677
Advertising and promotion	117		128		292		371
Restructuring, merger, and acquisition related expenses	58		—		208		993
NextGen implementation costs	—		—		1,560		—
Other expense	490		717		1,709		2,280
Total operating expenses	18,166		18,766		50,902		56,194
Loss from operations	(4,089)		(4,385)		(8,103)		(15,801)
Non-operating income and expense:
Gain on fair value of private warrant liability	54		433		—		2,449
Other loss	951		—		951		—
Loss before income tax expense	(4,986)		(3,952)		(9,054)		(13,352)
Income tax expense	9		—		24		16
Net loss	$	(4,995)	$	(3,952)	$	(9,078)	$	(13,368)

Weighted average number of shares outstanding - basic	11,799		11,570		11,768		11,567
Weighted average number of shares outstanding - diluted	11,799		11,570		11,768		11,567

Basic loss per common share	$	(0.42)	$	(0.34)	$	(0.77)	$	(1.16)
Diluted loss per common share	$	(0.42)	$	(0.34)	$	(0.77)	$	(1.16)

See accompanying notes to the unaudited consolidated financial statements.

BM TECHNOLOGIES, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY — UNAUDITED

For the Three and Nine Months Ended September 30, 2024 and 2023

(amounts in thousands, except share data)


	Common Stock
	Shares of Common Stock Outstanding	Common Stock		Additional Paid in Capital		Accumulated Deficit		Total
Balance at December 31, 2023	11,984,133	$	1	$	71,787	$	(40,816)	$	30,972
Net income	—	—		—		748		748

Tax paid on behalf of employees related to net settlement of share-based awards	(51,133)	—		(176)		—		(176)
Share-based compensation expense	130,773	—		(660)		—		(660)
Balance at March 31, 2024	12,063,773	$	1	$	70,951	$	(40,068)	$	30,884
Net loss	—	—		—		(4,831)		(4,831)
Conversion of private warrants to public warrants	—	—		—		—		—
Tax paid on behalf of employees related to net settlement of share-based awards	(13,725)	—		(57)		—		(57)
Share-based compensation expense	40,940	—		126		—		126
Balance at June 30, 2024	12,090,988	$	1	$	71,020	$	(44,899)	$	26,122
Net loss						(4,995)		(4,995)
Tax paid on behalf of employees related to net settlement of share-based awards	(731)	—		2		—		2
Share-based compensation expense	9,233	—		399		—		399
Balance at September 30, 2024	12,099,490	$	1	$	71,421	$	(49,894)	$	21,528


	Common Stock
(amounts in thousands, except share data)	Shares of Common Stock Outstanding	Common Stock		Additional Paid-in Capital		Accumulated Deficit		Total
Balance at December 31, 2022	12,240,237	$	1	$	72,342	$	(23,485)	$	48,858
Net loss	—	—		—		(4,960)		(4,960)
Conversion of private warrants to public warrants	—	—		20		—		20
Tax paid on behalf of employees related to net settlement of share-based awards	(473,874)	—		(2,429)		—		(2,429)
Share-based compensation expense	95,147	—		447		—		447
Balance at March 31, 2023	11,861,510	$	1	$	70,380	$	(28,445)	$	41,936
Net loss	—	—		—		$	(4,456)	(4,456)
Tax paid on behalf of employees related to net settlement of share-based awards	(1,765)	—		(5)		—		(5)
Share-based compensation expense	6,600	—		568		—		568
Balance at June 30, 2023	11,866,345	$	1	$	70,943	$	(32,901)	$	38,043
Net loss	—	$	—	$	—	$	(3,952)	$	(3,952)
Tax paid on behalf of employees related to net settlement of share-based awards	(1,253)	$	—	$	(4)	—		(4)
Share-based compensation expense	4,833	$	—	$	153	—		153
September 30, 2023	11,869,925	$	1	$	71,092	$	(36,853)	$	34,240

See accompanying notes to the unaudited consolidated financial statements.

BM TECHNOLOGIES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS — UNAUDITED

(amounts in thousands)


	Nine Months Ended September 30,
	2024		2023
Cash Flows from Operating Activities:
Net loss	$	(9,078)	$	(13,368)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation of premises and equipment	236		198

Amortization of developed software	4,332		9,250
Amortization of other intangible assets	240		240
Impairment of software assets	50		—
Provision for bad debt	440		350
Share-based compensation expense	(135)		1,534
Gain on fair value of private warrant liability	—		(2,449)
Changes in operating assets and liabilities:
Accounts receivable	3,797		(601)
Prepaid expenses and other current assets	2,834		2,988
Other assets	—		72
Accounts payable and accrued liabilities	(282)		(537)


Deferred revenue	(590)		(3,207)

Net Cash provided by (used in) Operating Activities	1,844		(5,530)
Cash Flows from Investing Activities:
Development of internal use software	(4,546)		(4,114)
Purchases of premises and equipment	(131)		(224)
Net Cash used in Investing Activities	(4,677)		(4,338)
Cash Flows from Financing Activities:

Payments related to net settlement of share-based compensation awards	(231)		(2,438)
Net Cash used in Financing Activities	(231)		(2,438)
Net Decrease in Cash and Cash Equivalents	(3,064)		(12,306)
Cash and Cash Equivalents – Beginning	14,288		21,108
Cash and Cash Equivalents – Ending	$	11,224	$	8,802

Supplementary Cash Flow Information:
Income taxes refunded, net	$	(2,380)	$	(4,323)
Noncash Operating, Investing, and Financing Activities:
Conversion of private warrants to public warrants	$	—	$	20
Impairment of software assets	480

SEC Form 10-Q filed by BM Technologies Inc.