When Will Alkami Technology, Inc. (NASDAQ:ALKT) Become Profitable?

Alkami Technology, Inc. (NASDAQ:ALKT) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Alkami Technology, Inc. offers cloud-based digital banking solutions in the United States. With the latest financial year loss of US$63m and a trailing-twelve-month loss of US$57m, the US$3.0b market-cap company alleviated its loss by moving closer towards its target of breakeven. As path to profitability is the topic on Alkami Technology's investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

View our latest analysis for Alkami Technology

According to the 10 industry analysts covering Alkami Technology, the consensus is that breakeven is near. They expect the company to post a final loss in 2025, before turning a profit of US$35m in 2026. Therefore, the company is expected to breakeven roughly 2 years from now. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 92%, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving Alkami Technology's growth isn’t the focus of this broad overview, however, bear in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we’d like to point out is that Alkami Technology has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which usually has a high level of debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.

Next Steps:

There are key fundamentals of Alkami Technology which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Alkami Technology, take a look at Alkami Technology's company page on Simply Wall St. We've also put together a list of essential factors you should further research:

1. Valuation: What is Alkami Technology worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Alkami Technology is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Alkami Technology’s board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com