Katapult's Third Quarter Results Highlight Strong Growth, Improving Profitability, and Strategic Investment

Third Quarter Shows 25% Originations Growth and Substantial Adjusted EBITDA Gains

Katapult Holdings, Inc. delivered another solid performance in the third quarter of 2025, continuing its multi-year growth trajectory in the e-commerce-focused fintech sector. The company’s gross originations jumped by 25.3% to $64.2 million, and revenue climbed by 22.8% to $74.0 million compared to the same period last year. These numbers represent Katapult's third consecutive year of Q3 growth—a testament to rising customer demand, successful product innovations, and strengthened partnerships with merchants.

Key business drivers included an 80% year-over-year increase in total applications, a 44% boost in app marketplace originations, and 76% growth in unique KPay customers. The company's repeat customer rate remained strong at 55% of gross originations, underlining customer loyalty and engagement.

Profitability Improving Despite Challenging Backdrop

Katapult made significant strides in profitability. Adjusted EBITDA soared to $4.42 million in Q3 2025, up from just $0.55 million in Q3 2024, while adjusted net loss improved to $0.96 million compared to $4.07 million a year earlier. The net loss narrowed substantially, helped by lower litigation and compensation costs. The company also reduced fixed cash operating expenses by 21.4% year-over-year, indicating tighter cost management amid ongoing investments in product development and customer acquisition.

Balance Sheet Bolstered by $65M Strategic Investment from Hawthorn Horizon

A pivotal event for Katapult in Q3 was a $65 million investment from Hawthorn Horizon Credit Fund, structured through convertible preferred stock. The capital injection immediately improved liquidity, with part of the proceeds used to repay debt, further fortifying Katapult’s financial footing. If fully converted, Hawthorn could own approximately 54.5% of Katapult's common shares, demonstrating significant stakeholder confidence in the company’s future.

This move brought board changes and is expected to support further growth initiatives and strengthen the company’s ability to reach sustained profitability.

Operational Metrics Show Continued App Marketplace Expansion

The Katapult app marketplace emerged as the largest single referral source for customer originations—accounting for 61% of gross originations in Q3, and posting 44% year-over-year growth. Consumer engagement is rising, with enhancements to app features, effective marketing, and new merchants (including Apple) joining the KPay ecosystem, which now hosts 40 merchants.

Looking Forward: Guidance Remains Positive but Tempered by Macroeconomic Uncertainty

Despite economic headwinds and softness in the home furnishings sector, Katapult projects another strong fourth quarter: 15% to 20% year-over-year gross originations growth, 21% to 23% revenue growth, and $2 million in adjusted EBITDA. For the full year 2025, management expects originations growth between 20% and 23%, revenue up 18% to 20%, and adjusted EBITDA reaching $8 million to $9 million. The company also notes that credit quality is expected to remain strong, with write-offs as a percentage of revenue tracking within the long-term target range at 9.9% in Q3.

Key Takeaways: Platform Strength and Strategic Capital Point to Long-Term Upside

Katapult’s Q3 2025 results spotlight accelerating growth, improving operational efficiency, and growing market share among non-prime consumers—a valuable segment especially in uncertain economic times. With a strengthened balance sheet, product expansion, and a robust app ecosystem, Katapult appears poised to capture further market share in lease-to-own e-commerce.

For investors and industry watchers, Katapult’s operational and financial momentum, paired with strategic investment, could warrant closer scrutiny in the quarters ahead as the company works toward its goal of sustained profitability.

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