- Reiterates 2025 guidance of $80 million to $90 million in revenue and mid-40s percentage gross margin -
SAN DIEGO, CA, March 31, 2025 (GLOBE NEWSWIRE) -- RYVYL Inc. (NASDAQ: RVYL) ("RYVYL" or the "Company"), a leading innovator of payment transaction solutions leveraging electronic payment technology for the diverse international markets, reported its financial results for the quarter and year ended December 31, 2024.
RYVYL Co-founder and CEO Fredi Nisan issued the following business update for investors.
"We made significant progress in 2024 as our U.S. operations stabilized over the past several quarters, while our International segment maintained a strong growth trajectory. International revenue for 2024 reached $37.8 million, representing a remarkable 124% increase compared to 2023. With momentum building in both the U.S. and international markets, we are actively onboarding new clients across multiple jurisdictions, further strengthening our market presence and positioning us for a high-growth year in 2025.
Our global pipeline is robust, and we are rapidly gaining traction with our Payments-as-a-Service offering from RYVYL EU. We are strategically positioned to capitalize on substantial opportunities as we continue to expand our market reach.
"We are building on our core competitive strengths and foundation, and I'm excited to offer a summary of our progress and reiterate our 2025 guidance of $80 million to $90 million in revenue and mid-40s percentage gross margin.
Business Overview and Competitive Position
Our competitive strengths, unique value proposition, and strategic focus are what truly set us apart in the fintech space. We're especially optimistic about our position in the market, as the global shift toward credit cards, mobile wallets, and real-time payment platforms continues to accelerate. Our solutions are purpose-built for this evolution, leveraging our longstanding investment in proprietary payment and banking technologies to stay ahead of the curve.
As fintech innovators are rapidly disrupting the landscape with agile, cost-effective models, RYVYL is strongly positioned to lead the way. We are nimble, innovative, and well-prepared to capitalize on this favorable environment, driving forward as a leader in the next era of digital payments.
We are committed to continuously evolving our product portfolio to anticipate and meet the ever-changing needs of businesses worldwide. At the heart of this effort is the enhancement of our dual-sided payment platform, which seamlessly supports both acquiring and disbursement services. This platform is purpose-built to accommodate emerging use cases in acquiring, disbursements, and embedded finance, delivering comprehensive, end-to-end financial solutions that empower our clients to stay ahead in a dynamic market.
Technological innovation is transforming how consumers engage with their finances as multiple payment rails converge to offer greater flexibility and choice. RYVYL is at the forefront of this evolution with our next-generation payment technology. By integrating various payment systems and methods into a single, cohesive digital platform, we empower consumers and businesses to access multiple options-such as bank transfers, mobile payments, digital wallets, and more-all in one place. This innovative approach allows users to select the payment method that best meets their needs at any given moment, positioning RYVYL as a pioneer in the rapidly evolving financial landscape.
We target high-margin segments, focusing on merchants and retail clients who are often overlooked by traditional processors or left out of the existing financial ecosystem. Currently, we serve nearly 1,500 business customers across 50 industries, leveraging a diversified foundation to establish ourselves as a global innovator in payment and banking solutions. By offering advanced banking and payment technologies, we're able to capture 40% gross margins in these high-potential areas. With new offerings like Payments-as-a-Service (PaaS) on the horizon and greater operational efficiencies through scale, we are well-positioned to continue driving margin expansion.
Our value proposition is distinct and forward-thinking. We deliver comprehensive banking and processing solutions that emphasize transparency, speed, and tailored processing capabilities designed for specific industries. Our customized, turnkey solutions are powered by cutting-edge technologies, such as AI, that set us apart. We leverage these advanced capabilities and tools to streamline operations, reduce errors, and enhance scalability, while AI-driven insights optimize decision-making and efficiency, creating a transformative approach to financial services.
Compliance and onboarding agility are fundamental to our business model-serving as key competitive advantages in this rapidly evolving landscape. As regulatory scrutiny and antitrust initiatives reshape the payment ecosystem, legacy networks are being challenged, creating new opportunities for innovative players. While real-time systems like FedNow are making strides, credit cards still dominate, and adoption remains gradual. Meanwhile, advancements in AI are transforming fraud prevention, transaction security, and seamless banking integration. RYVYL is strategically positioned to navigate and capitalize on these changes, leveraging our expertise to stay ahead in this dynamic environment.
We're driven by our momentum and confident in our path forward. Recent wins, increased pipeline visibility, and an expanding presence across verticals are propelling us to new heights. We're diversifying revenue streams and building stronger client relationships, positioning ourselves to meet the complex and evolving needs of our customers. Market demand remains robust, and we're well-prepared to capitalize on opportunities, further solidifying our position as a frontrunner in the sector.
Q4 2024 and Recent Highlights
During Q4 and recently, we:
- Completed two European software integrations in October, with these two European partners launching on the new platforms.
- Expanded our global reach by launching Visa Direct services in more geographies, increasing our footprint to a total of 16 countries.
- Launched co-branded debit cards in the EU.
- Went live with our next-generation Charge Savvy (POS).
- Implemented NEMS Core payments in the U.S.
Balance Sheet Restructuring
We completed key steps in our strategy to improve our capital structure, greatly reducing potential dilution and positioning us for profitable growth supported by increased financial flexibility.
In January 2025, we:
- Executed a Preferred Stock Repurchase and Note Repayment Agreement and paid the initial tranche of $13.0 million to a securityholder that:
- Redeemed of all shares of the Company's Series B Convertible Preferred Stock for which the liquidation value was $53.1 million; and
- Partially repaid an 8% Senior Convertible Note, reducing the outstanding principal from $18.3 million to $4.0 million, which is due on or before April 30, 2025.
- Entered into an agreement with a financing source for $15.0 million to fund the Preferred Stock Repurchase and Note Repayment Agreement transaction that was structured as a pre-funded asset sale with a 90-day closing period, which ends on April 23, 2025 and may be extended an additional 30 days to May 23, 2025, if the Company pays $500,000 for such extension. Shares in the Company's RYVYL EU subsidiary were placed in escrow during the closing period. Although there are no guarantees, the Company intends to terminate the asset sale within the closing period by paying $16.5 million in consideration of such termination.
We are pursuing a range of funding alternatives to raise capital to terminate the asset sale and anticipate completing this step in our financial strategy to further deleverage the balance sheet in Q2 2025. The Company has recently filed an S-1 registration statement to raise up to $24 million, including the overallotment, and intends to explore all fundraising options, including term debt, equity or some combination to fund the termination payment of $16.5 million.
Payments-as-a-Service (PaaS)
In March 2025, RYVYL EU landed two new Payments-as-a-Service (PaaS) contracts, which are anticipated to bring in close to one million new customer accounts over the next year. These partnerships mark a major step forward in expanding our presence across Europe and boosting our long-term growth potential. These partnerships are a strong endorsement of our ability to support fast-growing financial platforms and assist with their international growth. Our advanced payment technology enables quick and compliant onboarding, paired with the scalability today's digital banks demand.
- The first contract is with a prominent global money service provider and includes the provision of both virtual and physical payment cards through RYVYL's platform and mobile application. So far, 1,000 accounts have already been activated, and an additional 50,000 are expected to follow in 2025.
- The second agreement, with one of the world's largest fully digital banks, is expected to add 900,000 new customer accounts within 12 months, beginning in Q2 2025. API integrations and system testing are already underway, with the onboarding phase set to launch in the near future.
"We are poised for a strong growth year in 2025, with multiple initiative underway to leverage our technology and well-established customer infrastructure and market reputation, and I look forward to updating you on our progress," concluded Nisan.
Financial Summary for the Fourth Quarter Ended December 31, 2024
- Revenue: Fourth quarter 2024 revenue totaled $14.1 million, driven largely by $11.4 million from RYVYL EU. This compares to $22.2 million in revenue during the same period in 2023, of which $5.6 million was generated by RYVYL EU.
- Processing Volume: In the fourth quarter of 2024, processing volume rose 38.7% to $1.3 billion, compared to $0.9 billion in the fourth quarter of 2023. International operations accounted for $1.1 billion of the fourth quarter volume, a significant increase from the $591 million volume in the fourth quarter of 2023, fueled by strong growth across multiple verticals, particularly through our Independent Sales Organizations ("ISO") and partnership network, as well as expanded offerings in global payments processing and banking-as-a-service. In North America, processing volume totaled $176 million, down from $356 million in the fourth quarter of 2023.
- Cost of Revenue: Cost of revenue was $8.7 million in the fourth quarter of 2024, down from $14.5 million in the fourth quarter of 2023. This decrease was primarily due to reduced processing activity in North America, partially offset by higher processing volumes in the International segment.
- Gross Margin: Gross margin for the fourth quarter of 2024 was 38.2%, up from 35.0% in the fourth quarter of 2023, reflecting higher margin product mix.
- Operating Expenses: Operating expenses for the fourth quarter of 2024 were $11.4 million, compared to $10.6 million in the fourth quarter of 2023. This increase was primarily driven by a $3.0 million impairment charge in the fourth quarter of 2024 against intangible assets held in North America, partially offset by lower other operating expenses compared to the fourth quarter 2023.
- Other Expense, net: Other expense, net, decreased 97% to $0.9 million in the fourth quarter of 2024, down from $27.0 million in the fourth quarter of 2023. The net decrease was primarily driven by the multiple restructurings of the Company's convertible note during the fourth of 2023, with no comparable activity during the fourth quarter of 2024.
- Adjusted EBITDA: Adjusted EBITDA for the fourth quarter of 2024 was negative $1.7 million, compared to a positive $0.1 million in the fourth quarter of 2023.
Financial Summary Full Year Ended December 31, 2024
- Revenue: 2024 revenue was $56.0 million, driven largely by $37.8 million from RYVYL EU. This compares to $65.9 million during the same period in 2023, of which $16.9 million was generated by RYVYL EU.
- Cost of Revenue: Cost of revenue was $33.6 million, down $6.6 million, from $40.2 million during 2023, primarily due to reduced processing activity in North America, partially offset by higher processing volumes in the International segment.
- Gross Margin: Gross margin was 40.0%, up from 39.0% in 2023.
- Operating Expenses: 2024 operating expenses were $43.3 million compared to $38.0 million in 2023, due primarily to impairment charges recorded during 2024 of $6.7 million and $3.0 million for goodwill and intangible assets held in North America, respectively, with no comparable charges in 2023, partially offset by lower research and development expenses and professional fees.
- Other Expense, net: Other expense, net, decreased to $4.8 million in 2024, down from $40.5 million in 2023. This decrease was mainly driven by a $28.8 million net decrease in other expenses associated with the Company's multiple restructurings of its convertible note during 2023 with no comparable restructurings during 2024.
- Adjusted EBITDA: Adjusted EBITDA for 2024 was a loss of $5.7 million, compared to a loss of $3.9 million in 2023.
- Cash Balances: Cash and restricted cash as of December 31, 2024, was $92.0 million, with $89.4 million being restricted cash.
The foregoing guidance is based on the Company's continuation of the business, as currently conducted. On January 24, 2025, the Company entered into an agreement with a financing source that was structured as a pre-funded asset sale with a 90-day closing period, which ends on April 23, 2025 and may be extended an additional 30 days to May 23, 2025, if the Company pays $500,000 for such extension. Shares in the Company's RYVYL EU subsidiary were placed in escrow during the closing period. Although there are no guarantees, the Company intends to terminate the asset sale within the closing period by paying $16.5 million in consideration of such termination. The Company's financial guidance for 2025 is based on fully retaining its RYVYL EU subsidiary.
About RYVYL
RYVYL Inc. (NASDAQ: RVYL) was born from a passion for empowering a new way to conduct business-to-business, consumer-to-business, and peer-to-peer payment transactions around the globe. By leveraging electronic payment technology for diverse international markets, RYVYL is a leading innovator of payment transaction solutions reinventing the future of financial transactions. Since its founding as GreenBox POS in 2017 in San Diego, RYVYL has developed applications enabling an end-to-end suite of turnkey financial products with enhanced security and data privacy, world-class identity theft protection, and rapid speed to settlement. As a result, the platform can log immense volumes of immutable transactional records at the speed of the internet for first-tier partners, merchants, and consumers around the globe. www.ryvyl.com
Cautionary Note Regarding Forward-Looking Statements
This press release includes information that constitutes 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. These forward-looking statements are based on the Company's current beliefs, assumptions, and expectations regarding future events, which in turn are based on information currently available to the Company. Such forward-looking statements include statements regarding anticipated revenues and margins, timely payment of the second tranche, the benefit to stockholders from the repayment of the Note and repurchase of the Preferred Stock, and the timing and expectation of revenues from the license described herein and are charactered by future or conditional words such as "may," "will," "expect," "intend," "anticipate," "believe," "estimate" and "continue" or similar words. You should read statements that contain these words carefully because they discuss future expectations and plans, which contain projections of future results of operations or financial condition or state other forward-looking information. By their nature, forward-looking statements address matters that are subject to risks and uncertainties. A variety of factors could cause actual events and results to differ materially from those expressed in or contemplated by the forward-looking statements, including the risk that the licensee understands and complies with various banking laws and regulations that may impact the licensee's ability to process transactions. For example, federal money laundering statutes and Bank Secrecy Act regulations discourage financial institutions from working with operators of certain industries - particularly industries with heightened cash reporting obligations and restrictions - as a result of which, banks may refuse to process certain payments and/or require onerous reporting obligations by payment processors to avoid compliance risk. These statements are also subject to any damages the Company could suffer as the result of previously announced litigation or actions of any governmental agencies. These and other risk factors affecting the Company are discussed in detail in the Company's periodic filings with the SEC. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether because of the latest information, future events or otherwise, except to the extent required by applicable laws.
IR Contact:
David Barnard, Alliance Advisors Investor Relations, 415-433-3777, ryvylinvestor@allianceadvisors.com
RYVYL INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| ASSETS | ||||||||
| Current Assets: | ||||||||
| Cash | $ | 2,599 | $ | 12,180 | ||||
| Restricted cash | 89,432 | 61,138 | ||||||
| Accounts receivable, net of allowance for credit losses of $206 and $23, respectively | 1,076 | 859 | ||||||
| Cash due from gateways, net of allowance of $89 and $2,636, respectively | 88 | 12,834 | ||||||
| Prepaid and other current assets | 2,189 | 2,854 | ||||||
| Total current assets | 95,384 | 89,865 | ||||||
| Non-current Assets: | ||||||||
| Property and equipment, net | 165 | 306 | ||||||
| Goodwill | 18,856 | 26,753 | ||||||
| Intangible assets, net | 1,802 | 5,059 | ||||||
| Operating lease right-of-use assets, net | 3,425 | 4,279 | ||||||
| Other assets | 2,644 | 2,403 | ||||||
| Total non-current assets | 26,892 | 38,800 | ||||||
| Total assets | $ | 122,276 | $ | 128,665 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY/(DEFICIT) | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable | $ | 3,515 | $ | 1,819 | ||||
| Accrued liabilities | 8,146 | 5,755 | ||||||
| Payment processing liabilities, net | 90,802 | 76,772 | ||||||
| Current portion of operating lease liabilities | 839 | 692 | ||||||
| Other current liabilities | 240 | 504 | ||||||
| Total current liabilities | 103,542 | 85,542 | ||||||
| Long term debt, net of debt discount of $3,906 and $24,349, respectively | 17,363 | 15,912 | ||||||
| Operating lease liabilities, less current portion | 2,863 | 3,720 | ||||||
| Total liabilities | 123,768 | 105,174 | ||||||
| Stockholders' Equity/(Deficit): | ||||||||
| Preferred stock, Series B, par value $0.01, 5,000,000 shares authorized; 53,499 and 55,000 shares issued and outstanding at December 31, 2024 and 2023, respectively | 1 | 1 | ||||||
| Common stock, par value $0.001, 100,000,000 shares authorized; 8,032,318 and 5,996,948 shares issued and outstanding at December 31, 2024 and 2023, respectively | 8 | 6 | ||||||
| Additional paid-in capital | 179,157 | 175,664 | ||||||
| Accumulated other comprehensive income | (1,251 | ) | 401 | |||||
| Accumulated deficit | (179,407 | ) | (152,581 | ) | ||||
| Total stockholders' (deficit)/equity | (1,492 | ) | 23,491 | |||||
| Total liabilities and stockholder's (deficit)/equity | $ | 122,276 | $ | 128,665 | ||||
RYVYL INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(In thousands, except share and par value data)
| Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Revenue | $ | 14,127 | $ | 22,249 | $ | 55,998 | $ | 65,869 | ||||||||
| Cost of revenue | 8,730 | 14,455 | 33,572 | 40,157 | ||||||||||||
| Gross profit | 5,397 | 7,794 | 22,426 | 25,712 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Advertising and marketing | 20 | (73 | ) | 95 | 80 | |||||||||||
| Research and development | 821 | 1,323 | 3,848 | 5,757 | ||||||||||||
| General and administrative | 1,826 | 1,968 | 6,933 | 8,678 | ||||||||||||
| Payroll and payroll taxes | 4,167 | 3,785 | 13,836 | 12,017 | ||||||||||||
| Professional fees | 1,016 | 1,425 | 4,372 | 7,076 | ||||||||||||
| Stock compensation expense | 83 | 1,544 | 624 | 1,853 | ||||||||||||
| Depreciation and amortization | 438 | 654 | 2,264 | 2,553 | ||||||||||||
| Impairment of goodwill | - | - | 6,675 | - | ||||||||||||
| Impairment of intangible assets | 3,028 | - | 3,028 | - | ||||||||||||
| Restructuring charges | - | - | 1,636 | - | ||||||||||||
| Total operating expenses | 11,399 | 10,626 | 43,311 | 38,014 | ||||||||||||
| Loss from operations | (6,002 | ) | (2,832 | ) | (20,885 | ) | (12,302 | ) | ||||||||
| Other income (expense): | ||||||||||||||||
| Interest expense | (400 | ) | (30 | ) | (862 | ) | (3,340 | ) | ||||||||
| Accretion of debt discount | (280 | ) | (3,508 | ) | (2,258 | ) | (13,134 | ) | ||||||||
| Changes in fair value of derivative liability | - | (35 | ) | 14 | 6,544 | |||||||||||
| Derecognition expense on conversion of convertible debt | (531 | ) | (23,516 | ) | (600 | ) | (25,035 | ) | ||||||||
| Legal settlement expense | (467 | ) | - | (2,064 | ) | (4,142 | ) | |||||||||
| Gain on sale of property and equipment | - | 1,069 | - | 1,069 | ||||||||||||
| Other income (expense) | 754 | (999 | ) | 970 | (2,472 | ) | ||||||||||
| Total other expense, net | (924 | ) | (27,020 | ) | (4,800 | ) | (40,510 | ) | ||||||||
| Loss before provision for income taxes | (6,926 | ) | (29,852 | ) | (25,685 | ) | (52,812 | ) | ||||||||
| Income tax provision | (75 | ) | 151 | 1,140 | 289 | |||||||||||
| Net loss | $ | (6,851 | ) | $ | (30,003 | ) | $ | (26,825 | ) | $ | (53,101 | ) | ||||
| Comprehensive income statement: | ||||||||||||||||
| Net loss | (6,851 | ) | (30,003 | ) | (26,825 | ) | (53,101 | ) | ||||||||
| Foreign currency translation (loss) gain | (2,371 | ) | 433 | (1,652 | ) | 44 | ||||||||||
| Total comprehensive loss | $ | (9,222 | ) | $ | (29,570 | ) | $ | (28,477 | ) | $ | (53,057 | ) | ||||
| Net loss per share: | ||||||||||||||||
| Basic and diluted | $ | (0.91 | ) | $ | (5.43 | ) | $ | (4.01 | ) | $ | (10.11 | ) | ||||
| Weighted average number of common shares outstanding: | ||||||||||||||||
| Basic and diluted | 7,543,480 | 5,525,608 | 6,694,165 | 5,251,852 | ||||||||||||
RYVYL INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(In thousands)
| Year Ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | (26,825 | ) | $ | (53,101 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation and amortization expense | 2,264 | 2,553 | ||||||
| Noncash lease expense | 143 | 350 | ||||||
| Stock compensation expense | 624 | 1,853 | ||||||
| Restricted common stock issued for compensation | 182 | - | ||||||
| Accretion of debt discount | 2,258 | 13,134 | ||||||
| Derecognition expense on conversion of convertible debt | 600 | 25,035 | ||||||
| Changes in fair value of derivative liability | (14 | ) | (6,544 | ) | ||||
| Gain on sale of property and equipment | - | (1,069 | ) | |||||
| Impairment of goodwill | 6,675 | - | ||||||
| Impairment of intangible assets | 3,028 | - | ||||||
| Restructuring charges | 1,636 | - | ||||||
| Changes in assets and liabilities: | ||||||||
| Accounts receivable, net | (155 | ) | 297 | |||||
| Prepaid and other current assets | 664 | 6,568 | ||||||
| Cash due from gateways, net | 12,684 | (5,407 | ) | |||||
| Other assets | (160 | ) | (1,183 | ) | ||||
| Accounts payable | 1,695 | 189 | ||||||
| Accrued and other current liabilities | 1,497 | 2,080 | ||||||
| Accrued interest | 366 | 546 | ||||||
| Payment processing liabilities, net | 14,029 | 47,860 | ||||||
| Net cash provided by operating activities | 21,191 | 33,161 | ||||||
| Cash flows from investing activities: | ||||||||
| Purchases of property and equipment | (47 | ) | (108 | ) | ||||
| Logicquest Technology acquisition | - | (225 | ) | |||||
| Proceeds from sale of property and equipment | - | 2,620 | ||||||
| Capitalized software development costs | (1,647 | ) | - | |||||
| Purchase of intangibles | (114 | ) | - | |||||
| Net cash (used in) provided by investing activities | (1,808 | ) | 2,287 | |||||
| Cash flows from financing activities: | ||||||||
| Treasury stock purchases | - | 7 | ||||||
| Repayments of convertible debt | - | (3,000 | ) | |||||
| Repayments on long-term debt | (12 | ) | (15 | ) | ||||
| Tax withholdings related to net settlement of equity awards | (229 | ) | - | |||||
| Net cash used in financing activities | (241 | ) | (3,008 | ) | ||||
| Effect of exchange rates in cash and restricted cash | (430 | ) | 44 | |||||
| Net increase (decrease) in cash and restricted cash | 18,712 | 32,484 | ||||||
| Cash and restricted cash - beginning of period | 73,318 | 40,834 | ||||||
| Cash and restricted cash - end of period | $ | 92,030 | $ | 73,318 | ||||
| Supplemental disclosures of cash flow information | ||||||||
| Cash paid during the period for: | ||||||||
| Interest | $ | 300 | $ | 2,709 | ||||
| Income taxes | $ | 848 | $ | 199 | ||||
| Non-cash financing and investing activities: | ||||||||
| Convertible debt conversion to preferred stock | $ | 900 | $ | 64,600 | ||||
| Convertible debt conversion to common stock | $ | - | $ | 1,650 | ||||
| Interest accrual from convertible debt converted to preferred stock | $ | - | $ | 1,703 | ||||
| Interest accrual from convertible debt converted to common stock | $ | - | $ | 4 | ||||
Use of Non-GAAP Financial Information
Adjusted earnings before interest, taxes, depreciation, and amortization ("Adjusted EBITDA") is a non-GAAP measure that represents our net loss before interest expense, amortization of debt discount, income tax expense, depreciation and amortization, changes in the fair value of derivative liabilities, losses on the extinguishment and derecognition expenses on the conversion of convertible debt, non-cash stock-based compensation expense, acquisition-related expense, non-recurring provisions for credit losses on legacy matters, accounting fees related to the restatement of prior period financial statements, non-recurring costs related to the spin-off of a subsidiary, and legal costs and settlement fees incurred in connection with non-ordinary course litigation and other disputes.
We exclude these items in calculating Adjusted EBITDA because we believe that the exclusion of these items will provide for more meaningful information about our financial performance, and do not consider the excluded items to be part of our ongoing results of operations. Our use of Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our financial results as reported under GAAP. Some of these limitations are: (a) although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and Adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements; (b) Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs; (c) Adjusted EBITDA does not reflect the potentially dilutive impact of equity-based compensation; (d) Adjusted EBITDA does not reflect tax payments that may represent a reduction in cash available to us; and (e) other companies, including companies in our industry, may calculate Adjusted EBITDA or similarly titled measures differently, which reduces its usefulness as a comparative measure.
Because of these and other limitations, you should consider Adjusted EBITDA alongside our other GAAP-based financial performance measures, net income (loss) and our other GAAP financial results. The following table presents a reconciliation of Adjusted EBITDA from net loss, the most directly comparable GAAP measure, for the periods indicated:
Reconciliation of Net Loss attributable to RYVYL, Inc., to Adjusted EBITDA for the
Three and Twelve Months Ended December 31, 2024 and 2023
(In thousands, except share and per share data)
| Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Net loss | $ | (6,851 | ) | $ | (30,003 | ) | $ | (26,825 | ) | $ | (53,101 | ) | ||||
| Interest expense | 400 | 30 | 862 | 3,340 | ||||||||||||
| Accretion of debt discount | 280 | 3,508 | 2,259 | 13,134 | ||||||||||||
| Income tax provision | (75 | ) | 151 | 1,140 | 289 | |||||||||||
| Depreciation and amortization | 438 | 654 | 2,264 | 2,553 | ||||||||||||
| EBITDA | (5,807 | ) | (25,660 | ) | (20,301 | ) | (33,785 | ) | ||||||||
| Other non-cash adjustments: | ||||||||||||||||
| Changes in fair value of derivative liability | - | 35 | (14 | ) | (6,544 | ) | ||||||||||
| Derecognition expense on conversion of convertible debt | 531 | 23,516 | 600 | 25,035 | ||||||||||||
| Stock compensation expense | 83 | 1,544 | 624 | 1,853 | ||||||||||||
| Impairment of goodwill | - | - | 6,675 | - | ||||||||||||
| Impairment of intangible assets | 3,028 | - | 3,028 | - | ||||||||||||
| Restructuring charges | - | - | 1,636 | - | ||||||||||||
| Special items: | ||||||||||||||||
| Non-recurring legal settlements and ongoing matters and related legal fees | 467 | - | 2,064 | 5,308 | ||||||||||||
| Carryover effects of financial statement restatements in prior periods | - | 691 | - | 1,913 | ||||||||||||
| Non-recurring provision for credit losses on legacy matters | - | - | - | 1,994 | ||||||||||||
| Accounting fees related to the restatement of prior period financial statements | - | - | - | 237 | ||||||||||||
| Non-recurring impairment of right of use asset | - | - | - | 100 | ||||||||||||
| Non-recurring costs of spin-off | - | - | - | 29 | ||||||||||||
| Adjusted EBITDA | $ | (1,699 | ) | $ | 126 | $ | (5,688 | ) | $ | (3,860 | ) | |||||
| Loss from operations | $ | (6,002 | ) | $ | (2,832 | ) | $ | (20,885 | ) | $ | (12,302 | ) | ||||
