• Revenue: Increased 10% year over year to $17.6 million.
• Payments Volume: Carta's payment volume up 12% to $2.8 billion.
• Adjusted EBITDA: $1.4 million, up 40% sequentially from Q1.
• Cash Flow from Operations: Positive $0.5 million, compared to negative $1.8 million in Q2 of last year.
• Operating Expenses: Flat year over year after a 50% reduction in 2022.
• Cash and Total Investments: Approximately $41 million.
• ARPU (Average Revenue Per User): $25 across consumer base products; $180 for wealth products.
• Subscription Services Revenue Growth Outlook: Expected to grow in the mid-teens for fiscal year 2024.
• Adjusted EBITDA Guidance for 2024: $5 million to $6 million.

• Warning! GuruFocus has detected 5 Warning Signs with MOGO.

Release Date: August 08, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Mogo Inc (NASDAQ:MOGO) generated positive cash flow from operations for the quarter.
• Revenue increased by 10% year over year to $17.6 million.
• Carta's payment volume grew by 12% to $2.8 billion, indicating strong performance in the payments business.
• The company achieved a milestone of positive overall cash flow after investing in financing activities.
• Mogo Inc (NASDAQ:MOGO) introduced a new 'Buffett Mode' feature in its self-directed investing app to promote long-term value investing.

Negative Points

• Adjusted EBITDA was down modestly from the same period last year, despite a 40% sequential increase.
• Marketing spend was down in Q2, indicating a cautious approach to growth.
• The company is still in the early stages of its journey in the wealth space, suggesting potential challenges in gaining market share.
• Mogo Inc (NASDAQ:MOGO) has a relatively flat loan book, indicating limited growth in the lending business.
• The company's crypto-related investments, while significant, currently contribute 0% to revenue.

Q & A Highlights

Q: Can you give us a sense of how youre thinking about your cash moving forward through the back half of the year? A: Gregory Feller, CFO, explained that Mogo was cash flow positive on a consolidated basis, excluding debt repayment and share buyback. The company generated enough cash from operations to internally self-fund any investment in the loan book. This milestone indicates that Mogo can self-sustain its business while continuing to invest in growing its wealth and payments business.

Q: How are you thinking about the wealth and payments business individually through the back half of the year? A: Gregory Feller, CFO, stated that the payments business is expected to continue growing, with significant investments being made, including a migration to the cloud. This is expected to result in meaningful savings by Q1. David Feller, CEO, emphasized that the wealth business will focus on product improvements and strategic partnerships to drive growth, aiming for a strong product experience to drive word-of-mouth growth.

Q: Can you clarify the ARPU metrics for the wealth products? A: Gregory Feller, CFO, clarified that the average revenue per user (ARPU) across all Mogo products is $25, while the ARPU for the wealth product alone is $180. This highlights the opportunity to increase the overall monetization rate.

Q: How should we be thinking about the lending business longer term? A: Gregory Feller, CFO, mentioned that while the loan book is currently flat, Mogo sees long-term value in its lending business due to its extensive proprietary database. However, the company is prioritizing investments in wealth and payments over lending for now.

Q: What are the economics of the partnership with Tom Lee and Fundstrat? A: Gregory Feller, CFO, explained that the partnership is a marketing agreement with no equity involved. Mogo will pay a fee over the next 12 months, which will be reflected in their marketing expenses.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.