Release Date: March 20, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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Mogo Inc (NASDAQ:MOGO) reported a 9% increase in revenue for 2024, reaching $71.2 million, driven by a 16% increase in wealth revenue and a 21% increase in payments revenue.
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The company ended the year with $49.1 million in cash, marketable securities, and investments, up from $36.2 million in Q3.
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Assets under management in the wealth segment grew 22% year over year, reaching $428 million.
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Mogo Inc (NASDAQ:MOGO) extended its credit facility to 2029 with lower interest rates, improving financial flexibility.
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The company is focusing on high-growth areas such as wealth and payments, with projected revenue growth of 20-25% in wealth and mid to high teens in payments for 2025.
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Mogo Inc (NASDAQ:MOGO) decided to exit its institutional brokerage operations, which contributed $5.3 million in revenue for 2024, due to negligible operating margins.
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The company expects a decrease in interest revenue from its lending business by 8-10% in 2025 due to economic uncertainties.
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Adjusted EBITDA for 2024 was $6.7 million, a decline from $7.7 million in 2023.
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Mogo Inc (NASDAQ:MOGO) is no longer focused on generating positive adjusted net income for 2025, prioritizing growth and investment instead.
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The company is taking a cautious approach to lending due to macroeconomic uncertainties, including potential impacts from US-Canadian tariff disputes.
Q: Can you provide more color on the timing of the decision to exit the institutional brokerage business? Why is now the right time? A: Greg Feller, President and CFO, explained that the institutional brokerage business was a legacy operation acquired for regulatory licenses and was never core to Mogo’s strategy. It was volatile with negligible operating margins, making it a distraction. The decision to exit aligns with Mogo’s focus on scaling its wealth and payments businesses.
Q: As you look to scale wealth and payments, could we see potential acquisitions to accelerate that process? A: Dave Feller, CEO, mentioned that while acquisitions are not a priority, they are not ruled out. Mogo believes it has a significant opportunity with its current offerings in wealth, which are highly differentiated. Future acquisitions could be considered to enhance the ecosystem, but nothing is planned in the near term.
Q: Regarding the decision to pull back in the lending business, are you being proactive, or are you already seeing some deterioration in credit quality? A: Greg Feller stated that Mogo is being proactive. The lending business, once a major revenue source, is now a smaller part, allowing flexibility to adjust. Given the macroeconomic uncertainty, particularly around tariffs, Mogo decided to take a conservative approach. This decision could be revisited if conditions stabilize.
