Katapult Holdings, Inc. 2025 Annual Report: Key Highlights and Investor Insights

Executive Summary

Katapult Holdings, Inc. has released its 2025 Annual Report, outlining important operational, financial, and strategic developments. This report contains several critical points that current and potential investors should closely monitor, as they may have significant implications for the company’s share price and future outlook.

Key Points from the Annual Report

• Proposed Mergers with CCFI and Aaron’s:

  Katapult is in the process of merging with CCFI and Aaron’s. The completion of these mergers could substantially disrupt each company’s operations and create uncertainty, potentially affecting their respective financial results and business continuity. After the mergers, ownership distribution will change significantly, with CCFI equityholders expected to own approximately 79.9% of the combined organization, while Katapult shareholders will hold roughly 6% on a fully diluted basis. This dilution and change in control are highly price-sensitive and could impact shareholder value.

• Convertible Preferred Stock and Ownership Risk:

  If the Preferred Stock Investment Stockholder Approval is obtained, holders of Katapult Convertible Preferred Stock could become the majority owners of the company. This scenario would lead to a major shift in corporate control, which is a material issue for shareholders and could affect both the value and governance of Katapult.

• Loan Agreement and Indebtedness:

  Katapult is subject to a Loan Agreement. A breach or event of default that is not waived could accelerate the company’s obligations and terminate the agreement, materially impacting Katapult’s financial condition and operational viability.

• Market and Economic Risks:

  The company notes exposure to uncertain macroeconomic conditions, including inflation, interest rate rises, consumer spending cycles, and pandemic-related risks. Katapult’s customer base is predominantly financially vulnerable or coping, as defined by the Financial Health Network, which increases exposure to changes in consumer behavior and economic downturns.

• Operational Risks and Competitive Landscape:

  Katapult operates in a highly competitive, rapidly evolving environment. Risks include customer acquisition and retention, reliability of technology platforms, data security concerns, and regulatory compliance. The company’s ability to innovate and maintain effective internal controls is critical to future success.

• Regulatory and Legal Risks:

  Katapult faces risks from evolving laws and regulations, particularly those relating to rental purchase transactions, tax, and data privacy. Non-compliance or adverse legal outcomes could materially affect the company’s performance and share value.

• Nasdaq Listing Risk:

  There is a risk that Katapult may not meet the minimum requirements for continued listing on the Nasdaq Capital Market, which would significantly affect shareholder liquidity and company valuation.

• Shareholder Dilution and Market Reaction:

  The mergers will result in substantial shareholder dilution. There is a risk that investors may react negatively to the combined organization’s prospects, product offerings, and financial condition. Failure to achieve perceived benefits from the mergers or to meet analyst expectations could result in a decline in share price.

• Internal Controls and Financial Reporting:

  The company acknowledges the importance of identifying and remediating material weaknesses in internal controls over financial reporting. Failure to do so could undermine investor confidence and affect share value.

Operational and Strategic Initiatives

• Partnerships and Growth Strategy:

  Katapult aims to forge new partnerships to acquire customers, enhance brand awareness, and grow gross originations and revenue, leveraging its technology platform for scalable growth without inventory risk.

• Technology and Innovation:

  The company is focused on expanding its information and technology capabilities, including growth in its mobile app featuring Katapult Pay®, to drive customer adoption and retention.

Corporate Information

Katapult Holdings, Inc. is headquartered at 5360 Legacy Drive, Building 2, Plano, TX 75024. Shareholders can access company filings, governance documents, and reports via Katapult’s website (www.katapult.com) and the SEC’s website (www.sec.gov).

Risks and Forward-Looking Statements

The report contains extensive forward-looking statements regarding future operations, strategies, and market conditions. These statements are subject to numerous risks and uncertainties—including those listed above—and actual outcomes may differ materially from projections.

Disclaimer

Disclaimer: The information provided above is based on Katapult Holdings, Inc.’s 2025 Annual Report and is intended for informational purposes only. It does not constitute investment advice. Investors should carefully review the full report and consider all risks before making investment decisions. Past performance is no guarantee of future results. Katapult undertakes no obligation to update forward-looking statements, except as required by law.

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