What changed in this filing

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Item 1. Financial Statements

2023-08-08 compared with 2023-05-09 · 145 added, 94 removed, 662 unchanged (27% of the section changed)

2 unchanged sentences

CONSOLIDATED BALANCE SHEETS

March 31, 2023 December 31, 2022

June 30, 2023 December 31, 2022

Assets (In thousands, except par value)

8 unchanged sentences

Investment securities available-for-sale, at fair value 2,268,857 2,363,687

Loans to bank customers, net of allowance for loan losses of $ 13,254 and $ 9,078 as of March 31, 2023 and December 31, 2022, respectively

Loans to bank customers, net of allowance for loan losses of $ 12,641 and $ 9,078 as of June 30, 2023 and December 31, 2022, respectively

29,966 21,421

25 unchanged sentences

Class A common stock, $ 0.001 par value;

100,000 shares authorized as of March 31, 2023 and December 31, 2022;

51,994 and 51,674 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively

100,000 shares authorized as of June 30, 2023 and December 31, 2022;

52,341 and 51,674 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively

Additional paid-in capital 360,812 340,575

6 unchanged sentences

CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

(In thousands, except per share data)

27 unchanged sentences

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME AND LOSS

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

(In thousands)

1 unchanged sentence

Other comprehensive income (loss)

Unrealized holding gain (loss), net of tax 36,297 ( 112,596 )

Comprehensive income (loss) $ 72,309 $ ( 73,972 )

Unrealized holding (loss) gain, net of tax ( 33,366 ) ( 79,983 ) 2,931 ( 192,579 )

Comprehensive (loss) income $ ( 32,788 ) $ ( 64,975 ) $ 39,521 $ ( 138,947 )

See notes to unaudited consolidated financial statements

1 unchanged sentence

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

Three Months Ended March 31, 2023

Three Months Ended June 30, 2023

Class A Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Total Stockholders' Equity

1 unchanged sentence

(In thousands)

Balance at March 31, 2023 51,994 $ 52 $ 347,385 $ 799,594 $ ( 286,431 ) $ 860,600

Common stock issued under stock plans, net of withholdings and related tax effects 347 — 2,811 — — 2,811

Stock-based compensation — — 10,616 — — 10,616

Net income — — — 578 — 578

Other comprehensive loss — — — — ( 33,366 ) ( 33,366 )

Balance at June 30, 2023 52,341 $ 52 $ 360,812 $ 800,172 $ ( 319,797 ) $ 841,239

Three Months Ended June 30, 2022

Class A Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Total Stockholders' Equity

Shares Amount

(In thousands)

Balance at March 31, 2022 54,293 $ 54 $ 388,299 $ 737,994 $ ( 142,403 ) $ 983,944

Common stock issued under stock plans, net of withholdings and related tax effects 292 1 2,013 — — 2,014

Stock-based compensation — — 5,635 — — 5,635

Repurchases of Class A Common Stock ( 845 ) ( 1 ) ( 19,045 ) — — ( 19,046 )

Net income — — — 15,008 — 15,008

Other comprehensive loss — — — — ( 79,983 ) ( 79,983 )

Balance at June 30, 2022 53,740 $ 54 $ 376,902 $ 753,002 $ ( 222,386 ) $ 907,572

See notes to unaudited consolidated financial statements

GREEN DOT CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (CONTINUED)

Six Months Ended June 30, 2023

Class A Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Total Stockholders' Equity

Shares Amount

(In thousands)

Balance at December 31, 2022 51,674 $ 52 $ 340,575 $ 763,582 $ ( 322,728 ) $ 781,481

3 unchanged sentences

Other comprehensive income — — — — 2,931 2,931

Balance at March 31, 2023 51,994 $ 52 $ 347,385 $ 799,594 $ ( 286,431 ) $ 860,600

Three Months Ended March 31, 2022

Balance at June 30, 2023 52,341 $ 52 $ 360,812 $ 800,172 $ ( 319,797 ) $ 841,239

Six Months Ended June 30, 2022

Class A Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Total Stockholders' Equity

7 unchanged sentences

Other comprehensive loss — — — — ( 192,579 ) ( 192,579 )

Balance at March 31, 2022 54,293 $ 54 $ 388,299 $ 737,994 $ ( 142,403 ) $ 983,944

Balance at June 30, 2022 53,740 $ 54 $ 376,902 $ 753,002 $ ( 222,386 ) $ 907,572

See notes to unaudited consolidated financial statements

1 unchanged sentence

CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended March 31,

Six Months Ended June 30,

(In thousands)

37 unchanged sentences

Net changes in settlement assets and obligations to customers ( 21,705 ) ( 120,063 )

Contingent consideration payments — ( 1,647 )

Repurchase of Class A common stock — ( 44,046 )

Net cash (used in) provided by financing activities ( 161,648 ) 185,974

Net (decrease) increase in unrestricted cash, cash equivalents and restricted cash ( 93,836 ) 1,002

Net cash used in financing activities ( 272,578 ) ( 81,117 )

Net decrease in unrestricted cash, cash equivalents and restricted cash ( 154,393 ) ( 543,162 )

Unrestricted cash, cash equivalents and restricted cash, beginning of period 819,845 1,325,640

1 unchanged sentence

Cash paid for interest $ 2,721 $ 326

Cash paid (refund) for income taxes $ 509 $ ( 11 )

Cash paid for income taxes $ 9,289 $ 4,086

Reconciliation of unrestricted cash, cash equivalents and restricted cash at end of period:

16 unchanged sentences

Reference is made to our Annual Report on Form 10-K for the year ended December 31, 2022 for additional disclosures, including a summary of our significant accounting policies.

There have been no material changes to our significant accounting policies during the three months ended March 31, 2023.

There have been no material changes to our significant accounting policies during the six months ended June 30, 2023.

In our opinion, the accompanying unaudited consolidated financial statements contain all adjustments, consisting of normal and recurring items, necessary for the fair presentation of our financial position, results of operations and cash flows for the interim periods presented.

2 unchanged sentences

accordingly, accounting estimates require the exercise of judgment.

These financial statements were prepared using information reasonably available as of March 31, 2023 and through the date of this report.

These financial statements were prepared using information reasonably available as of June 30, 2023 and through the date of this report.

The accounting estimates used in the preparation of our consolidated financial statements may change as new events occur, as more experience is acquired, as additional information is obtained, and as our operating environment changes.

4 unchanged sentences

Within our segments, we believe that the nature, amount, timing and uncertainty of our revenue and cash flows and how they are affected by economic factors can be further illustrated based on the timing in which revenue for each of our products and services is recognized.

Our products and services are offered only to customers within the United States.

Our products and services are offered to customers within the United States and certain U.S.

The following table disaggregates our revenues earned from external customers by each of our reportable segments:

Three Months Ended March 31, 2023

Three Months Ended June 30, 2023

Consumer Services B2B Services Money Movement Services Total

7 unchanged sentences

Note 3—Revenues (continued)

Three Months Ended March 31, 2022

Three Months Ended June 30, 2022

Consumer Services B2B Services Money Movement Services Total

4 unchanged sentences

$ 146,401 $ 151,535 $ 54,143 $ 352,079

Six Months Ended June 30, 2023

Consumer Services B2B Services Money Movement Services Total

Timing of recognition (In thousands)

Transferred point in time $ 176,778 $ 68,362 $ 146,702 $ 391,842

Transferred over time 85,791 282,478 1,513 369,782

Operating revenues (1)

$ 262,569 $ 350,840 $ 148,215 $ 761,624

Six Months Ended June 30, 2022

Consumer Services B2B Services Money Movement Services Total

Timing of recognition (In thousands)

Transferred point in time $ 187,320 $ 83,690 $ 149,741 $ 420,751

Transferred over time 113,500 207,822 1,718 323,040

Operating revenues (1)

$ 300,820 $ 291,512 $ 151,459 $ 743,791

(1) Excludes net interest income, a component of total operating revenues, as it is outside the scope of ASC 606, Revenues.

4 unchanged sentences

These contract liabilities consist principally of unearned new card fees and monthly maintenance fees.

We recognized approximately $ 14.4 million and $ 16.5 million for the three months ended March 31, 2023 and 2022, respectively, that were included in deferred revenue at the beginning of the periods and did not recognize any revenue during these periods from performance obligations satisfied in previous periods.

We recognized approximately $ 7.6 million and $ 9.0 million in revenue for the three months ended June 30, 2023 and 2022, respectively, and $ 22.0 million and $ 25.5 million for the six months ended June 30, 2023 and 2022, respectively, that were included in deferred revenue at the beginning of the periods and did not recognize any revenue during these periods from performance obligations satisfied in previous periods.

Substantially all of the deferred revenue balances at the beginning of the periods are recognized in the first half of each year.

Changes in the deferred revenue balance are driven primarily by the amount of new card fees recognized during the period, and the degree to which these reductions to the deferred revenue balance are offset by the deferral of new card fees associated with cards sold during the period.

GREEN DOT CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)

Note 4— Investment Securities

2 unchanged sentences

(In thousands)

March 31, 2023

June 30, 2023

Corporate bonds $ 10,000 $ — $ ( 642 ) $ 9,358

9 unchanged sentences

Total investment securities $ 2,791,843 $ 8 $ ( 428,164 ) $ 2,363,687

GREEN DOT CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)

Note 4—Investment Securities (continued)

As of March 31, 2023 and December 31, 2022, the gross unrealized losses and fair values of available-for-sale investment securities that were in unrealized loss positions were as follows:

As of June 30, 2023 and December 31, 2022, the gross unrealized losses and fair values of available-for-sale investment securities that were in unrealized loss positions were as follows:

Less than 12 months 12 months or more Total fair value Total unrealized loss

1 unchanged sentence

(In thousands)

March 31, 2023

June 30, 2023

Corporate bonds $ — $ — $ 9,358 $ ( 642 ) $ 9,358 $ ( 642 )

11 unchanged sentences

federal government, as our investment policy restricts our investments to highly liquid, low credit risk assets.

As such, we have not recorded any significant credit-related impairment losses during the three months ended March 31, 2023 or 2022 on our available-for-sale investment securities.

Unrealized losses as of March 31, 2023 and December 31, 2022 are the result of increases in interest rates as our investment portfolio is comprised predominantly of fixed rate securities.

Substantially all of the underlying securities within our investment portfolio were in an unrealized loss position as of March 31, 2023 and December 31, 2022 due to the timing of our investment purchases, as a significant portion of our investments were purchased prior to recent increases in interest rates by the Federal Reserve, and general volatility in market conditions.

We do not intend to sell our investments, and we have determined that it is more likely than not that we will not be required to sell our investments before recovery of their amortized cost bases, which may be at maturity.

As of March 31, 2023, the contractual maturities of our available-for-sale investment securities were as follows:

As such, we have not recorded any significant credit-related impairment losses during the three and six months ended June 30, 2023 or 2022 on our available-for-sale investment securities.

Unrealized losses as of June 30, 2023 and December 31, 2022 are the result of increases in interest rates as our investment portfolio is comprised predominantly of fixed rate securities.

Substantially all of the underlying securities within our investment portfolio were in an unrealized loss position as of June 30, 2023 and December 31, 2022 due to the timing of our investment purchases, as a significant portion of our investments were purchased prior to recent increases in interest rates by the Federal Reserve, and general volatility in market conditions.

We do not currently intend to sell our investments, and we have determined that it is more likely than not that we will not be required to sell our investments before recovery of their amortized cost bases, which may be at maturity.

GREEN DOT CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)

Note 4—Investment Securities (continued)

As of June 30, 2023, the contractual maturities of our available-for-sale investment securities were as follows:

Amortized cost Fair value

7 unchanged sentences

The expected payments on mortgage-backed and asset-backed securities may not coincide with their contractual maturities because the issuers have the right to call or prepay certain obligations.

GREEN DOT CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)

Note 5— Accounts Receivable

Accounts receivable, net consisted of the following:

March 31, 2023 December 31, 2022

June 30, 2023 December 31, 2022

(In thousands)

11 unchanged sentences

Activity in the reserve for uncollectible overdrawn accounts from purchase transactions consisted of the following:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

(In thousands)

9 unchanged sentences

(In thousands)

March 31, 2023

June 30, 2023

Residential $ — $ — $ — $ — $ 4,824 $ 4,824

13 unchanged sentences

Percentage of outstanding 9.8 % 2.4 % 7.3 % 19.5 % 80.5 % 100.0 %

We offer an optional overdraft protection program service on certain demand deposit account programs that allows cardholders who opt-in to spend up to a pre-authorized amount in excess of their available card balance.

We offer an optional overdraft protection program service on certain demand deposit account programs that allows customers who opt-in and meet certain criteria to spend up to a pre-authorized amount in excess of their available balance.

When overdrawn, the purchase related balances due on these deposit accounts are reclassified as consumer loans.

Fees due from our cardholders for our overdraft service are included as a component of accounts receivable.

Overdrawn balances are unsecured and considered immediately due from the cardholder.

Overdrawn balances are unsecured and considered immediately due from the customer.

A portion of our secured credit card portfolio is classified as loans held for sale.

1 unchanged sentence

Changes in valuation allowances are recorded as a component of other income and expenses on our consolidated statement of operations.

As of March 31, 2023 and December 31, 2022, the fair value of the loans held for sale amounted to approximately $ 4.6 million and $ 5.3 million, respectively.

As of June 30, 2023 and December 31, 2022, the fair value of the loans held for sale amounted to approximately $ 4.3 million and $ 5.3 million, respectively.

Nonperforming Loans

1 unchanged sentence

See Note 2 — Summary of Significant Accounting Policies to the Consolidated Financial Statements of our Annual Report on Form 10-K for the year ended December 31, 2022 for further information on the criteria for classification as nonperforming.

March 31, 2023 December 31, 2022

June 30, 2023 December 31, 2022

(In thousands)

14 unchanged sentences

The table below presents the carrying value, gross of the related allowance for credit losses, of our loans within the primary credit quality indicators related to our loan portfolio:

March 31, 2023 December 31, 2022

June 30, 2023 December 31, 2022

Non-Classified Classified Non-Classified Classified

8 unchanged sentences

Activity in the allowance for credit losses on our loan portfolio consisted of the following:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

(In thousands)

17 unchanged sentences

Any future economic benefits derived from products or services developed by TailFin Labs will be negotiated on a case-by-case basis between the parties.

As of March 31, 2023 and December 31, 2022, our net investment in TailFin Labs amounted to approximately $ 113.4 million and $ 82.4 million, respectively, and is included in the long-term portion of prepaid expenses and other assets on our consolidated balance sheets.

We recorded equity in losses from TailFin Labs of $ 4.1 million and $ 2.1 million for the three months ended March 31, 2023 and 2022, respectively.

As of June 30, 2023 and December 31, 2022, our net investment in TailFin Labs amounted to approximately $ 110.2 million and $ 82.4 million, respectively, and is included in the long-term portion of prepaid expenses and other assets on our consolidated balance sheets.

We recorded equity in losses from TailFin Labs of $ 3.1 million and $ 5.0 million for the three months ended June 30, 2023 and 2022, respectively, and $ 7.2 million and $ 7.1 million for the six months ended June 30, 2023 and 2022, respectively.

These amounts are recorded as a component of other income and expense on our consolidated statements of operations.

Our equity method investments also include an investment held by our bank, which amounted to $ 4.8 million at March 31, 2023 and December 31, 2022.

Equity in earnings from this investment for the three months ended March 31, 2023 a nd 2022 were de minimis.

Our equity method investments also include an investment held by our bank, which amounted to $ 4.4 million and $ 4.8 million at June 30, 2023 and December 31, 2022, respectively.

Equity in earnings from this investment for the three and six months ended June 30, 2023 and 2022 were de minimis.

Note 8— Deposits

Deposits are categorized as non-interest or interest-bearing deposits as follows:

March 31, 2023 December 31, 2022

Deposits are categorized as non-interest bearing or interest-bearing deposit accounts as follows:

June 30, 2023 December 31, 2022

(In thousands)

9 unchanged sentences

The scheduled contractual maturities for total time deposits are presented in the table below:

March 31, 2023

June 30, 2023

(In thousands)

4 unchanged sentences

Due in 2027 1,073

Thereafter 832

Total time deposits $ 5,026

6 unchanged sentences

however, we may make voluntary repayments at any time prior to maturity.

As of March 31, 2023, we had no borrowings outstanding on the 2019 Revolving Facility and had the full amount available for use.

As of June 30, 2023, we had no borrowings outstanding on the 2019 Revolving Facility and had the full amount available for use.

In March 2023, we amended the terms of our agreement to replace LIBOR with the Secured Overnight Financing Rate ("SOFR").

5 unchanged sentences

We must also maintain a minimum fixed charge coverage ratio and a maximum consolidated leverage ratio at the end of each fiscal quarter, as set forth in the credit agreement.

At March 31, 2023, we were in compliance with all such covenants.

At June 30, 2023, we were in compliance with all such covenants.

If an event of default shall occur and be continuing under the facility, the commitments may be terminated and the principal amounts outstanding under the 2019 Revolving Facility, together with all accrued unpaid interest and other amounts owing in respect thereof, may be declared immediately due and payable.

We incurred total cash interest expense during the three months ended March 31, 2023 of approximately $ 1.6 million.

We did not incur any interest expense during the three months ended March 31, 2022.

We incurred total cash interest expense during the three and six months ended June 30, 2023 of approximately $ 0.2 million and $ 1.8 million, respectively.

We did not incur any interest expense during the three and six months ended June 30, 2022.

Note 10— Income Taxes

Income tax expense for the three months ended March 31, 2023 and 2022 differs from the amount computed by applying the statutory federal income tax rate to income before income taxes.

Income tax expense for the six months ended June 30, 2023 and 2022 differs from the amount computed by applying the statutory federal income tax rate to income before income taxes.

The sources and tax effects of the differences are as follows:

Three Months Ended March 31,

Six Months Ended June 30,

federal statutory tax rate 21.0 % 21.0 %

10 unchanged sentences

Note 10—Income Taxes (continued)

The effective tax rate for the three months ended March 31, 2023 and 2022 differs from the statutory federal income tax rate of 21%, primarily due to state income taxes, net of federal tax benefits, general business credits, stock-based compensation, cash value growth in bank owned life insurance policies, and the Internal Revenue Code (the "IRC") 162(m) limitation on the deductibility of executive compensation.

The net decrease in the effective tax rate for the three months ended March 31, 2023 as compared to the three months ended March 31, 2022 is primarily due to the impact of an increase of $ 0.8 million in general business credits, an increase of $ 0.4 million in tax benefits from bank owned life insurance policies, a decrease of $ 0.5 million subject to the IRC 162(m) limitation on the deductibility of certain executive compensation, and a decrease of $ 0.4 million in state income taxes, net of federal benefits.

These decreases were partially offset by the impact of a $ 1.1 million increase in tax expense associated with shortfalls from stock-based compensation.

We recognized a discrete tax expense related to tax shortfalls from stock based-compensation of $ 1.7 million for the three months ended March 31, 2023, compared to a $ 0.6 million discrete tax expense for the prior year comparable period.

The effective tax rate for the six months ended June 30, 2023 and 2022 differs from the statutory federal income tax rate of 21%, primarily due to state income taxes, net of federal tax benefits, general business credits, stock-based compensation, cash value growth in bank owned life insurance policies, and the Internal Revenue Code (the "IRC") 162(m) limitation on the deductibility of executive compensation.

The net increase in the effective tax rate for the six months ended June 30, 2023 as compared to the six months ended June 30, 2022 is primarily due to the impact of an increase of $ 0.2 million in state income taxes, net of federal benefits, and the impact of a $ 1.1 million increase in tax expense associated with shortfalls from stock-based compensation.

We recognized a discrete tax expense related to tax shortfalls from stock-based compensation of $ 2.3 million for the six months ended June 30, 2023, compared to a $ 1.2 million discrete tax expense for the prior year comparable period.

These increases were partially offset by the impact of an increase of $ 0.2 million in tax benefits from bank owned life insurance policies, a decrease of $ 0.7 million subject to the IRC 162(m) limitation on the deductibility of certain executive compensation, and the impact of general business credits.

On August 16, 2022, the Inflation Reduction Act of 2022 (the "IRA") was signed into law.

2 unchanged sentences

We have made a policy election to account for Global Intangible Low-Taxed Income ("GILTI") in the year the GILTI tax is incurred.

For the three months ended March 31, 2023 and 2022, the provision for GILTI tax expense was not material to our financial statements.

For the six months ended June 30, 2023 and 2022, the provision for GILTI tax expense was not material to our financial statements.

We establish a valuation allowance when we consider it more-likely-than-not that some portion or all of the deferred tax assets will not be realized.

As of March 31, 2023 and 2022, we did no t have a valuation allowance on any of our deferred tax assets as we believe it is more-likely-than-not that we will realize the benefits of our deferred tax assets.

As of June 30, 2023 and 2022, we did no t have a valuation allowance on any of our deferred tax assets as we believe it is more-likely-than-not that we will realize the benefits of our deferred tax assets.

We are subject to examination by the Internal Revenue Service, or IRS, and various state tax authorities.

2 unchanged sentences

The IRS initiated an examination of our 2017 U.S.

federal tax return during the second quarter ended June 30, 2020, and the examination remains ongoing as of March 31, 2023.

federal tax return during the second quarter ended June 30, 2020, and the examination remains ongoing as of June 30, 2023.

We do not expect the outcome of these examinations will have any material impact on our consolidated financial statements.

As of March 31, 2023, we have federal net operating loss carryforwards of approximately $ 15.2 million and state net operating loss carryforwards of approximately $ 102.3 million, which will be available to offset future income.

As of June 30, 2023, we have federal net operating loss carryforwards of approximately $ 15.2 million and state net operating loss carryforwards of approximately $ 102.3 million, which will be available to offset future income.

If not used, the federal net operating losses will expire between 2029 and 2034.

2 unchanged sentences

In addition, we have state business tax credits of approximately $ 20.9 million that can be carried forward indefinitely and other state business tax credits of approximately $ 1.1 million that will start to expire on December 31, 2023 and continue to expire through December 31, 2027.

As of March 31, 2023 and December 31, 2022, we had a liability of $ 12.3 million and $ 11.2 million, respectively, for unrecognized tax benefits related to various federal and state income tax matters excluding interest, penalties and related tax benefits.

As of June 30, 2023 and December 31, 2022, we had a liability of $ 12.3 million and $ 11.2 million, respectively, for unrecognized tax benefits related to various federal and state income tax matters excluding interest, penalties and related tax benefits.

The reconciliation of the beginning unrecognized tax benefits balance to the ending balance is as follows:

2 unchanged sentences

Note 10—Income Taxes (continued)

Three Months Ended March 31,

Six Months Ended June 30,

(In thousands)

Beginning balance $ 11,178 $ 10,972

Increases related to positions taken during prior years 1,260 —

Increases related to positions taken during the current year — 1,410

2 unchanged sentences

The total amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate $ 11,899 $ 12,055

As of March 31, 2023 and 2022, we recognized accrued interest and penalties related to unrecognized tax benefits of approximately $ 1.0 million and $ 0.9 million, respectively.

As of June 30, 2023 and 2022, we recognized accrued interest and penalties related to unrecognized tax benefits of approximately $ 1.2 million and $ 1.0 million, respectively.

Note 11— Stockholders' Equity

1 unchanged sentence

In February 2022, our Board of Directors authorized a $ 100 million increase to our stock repurchase program.

As of March 31, 2023, we have an authorized $ 4.5 million remaining under our stock repurchase program for additional repurchases.

As of June 30, 2023, we had an authorized $ 4.5 million remaining under our stock repurchase program for additional repurchases.

Accelerated Share Repurchases

19 unchanged sentences

We have reserved shares of our Class A common stock for issuance under these plans.

The total stock-based compensation expense recognized was $ 9.2 million and $ 14.9 million for the three months ended March 31, 2023 and 2022, respectively.

The total stock-based compensation expense recognized was $ 10.6 million and $ 5.6 million for the three months ended June 30, 2023 and 2022, respectively, and $ 19.8 million and $ 20.5 million for the six months ended June 30, 2023 and 2022, respectively.

GREEN DOT CORPORATION

2 unchanged sentences

Restricted Stock Units

Restricted stock unit activity for awards subject to only service conditions was as follows for the three months ended March 31, 2023:

Restricted stock unit activity for awards subject to only service conditions was as follows for the six months ended June 30, 2023:

Shares Weighted-Average Grant-Date Fair Value

5 unchanged sentences

Restricted stock units canceled ( 119 ) 32.45

Outstanding at March 31, 2023

Outstanding at June 30, 2023

2,261 $ 24.96

Performance-Based Restricted Stock Units

Performance-based restricted stock unit activity for the three months ended March 31, 2023 was as follows:

Performance-based restricted stock unit activity for the six months ended June 30, 2023 was as follows:

Shares Weighted-Average Grant-Date Fair Value

5 unchanged sentences

Adjustment for completed performance periods 15 46.82

Outstanding at March 31, 2023

Outstanding at June 30, 2023

1,251 $ 24.30

3 unchanged sentences

Stock Options

Total stock option activity for the three months ended March 31, 2023 was as follows:

Total stock option activity for the six months ended June 30, 2023 was as follows:

Options Weighted-Average Exercise Price

3 unchanged sentences

Options exercised ( 8 ) 16.34

Outstanding at March 31, 2023

Options canceled ( 139 ) 50.89

Outstanding at June 30, 2023

1,024 $ 23.81

Exercisable at March 31, 2023

Exercisable at June 30, 2023

1,024 $ 23.81

4 unchanged sentences

The calculation of basic and diluted earnings per share (EPS) was as follows:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

(In thousands, except per share data)

22 unchanged sentences

The following table shows the weighted-average number of anti-dilutive shares excluded from the diluted EPS calculation:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

(In thousands)

12 unchanged sentences

For more information regarding the fair value hierarchy and how we measure fair value, see Note 2–Summary of Significant Accounting Policies to the Consolidated Financial Statements of our Annual Report on Form 10-K for the year ended December 31, 2022.

As of March 31, 2023 and December 31, 2022, our assets carried at fair value on a recurring basis were as follows:

As of June 30, 2023 and December 31, 2022, our assets carried at fair value on a recurring basis were as follows:

Level 1 Level 2 Level 3 Total Fair Value

March 31, 2023 (In thousands)

June 30, 2023 (In thousands)

Investment securities:

13 unchanged sentences

Total assets $ — $ 2,363,687 $ 5,324 $ 2,369,011

We based the fair value of our fixed income securities held as of March 31, 2023 and December 31, 2022 on quoted prices in active markets for similar assets.

We had no transfers between Level 1, Level 2 or Level 3 assets or liabilities during the three months ended March 31, 2023 or 2022.

We based the fair value of our fixed income securities held as of June 30, 2023 and December 31, 2022 on quoted prices in active markets for similar assets.

We had no transfers between Level 1, Level 2 or Level 3 assets or liabilities during the three and six months ended June 30, 2023 or 2022.

A reconciliation of changes in fair value for Level 3 assets or liabilities are not considered material to these consolidated financial statements and therefore are not presented for any of the periods presented.

19 unchanged sentences

Fair Value of Financial Instruments

The carrying values and fair values of certain financial instruments that were not carried at fair value, excluding short-term financial instruments for which the carrying value approximates fair value, at March 31, 2023 and December 31, 2022 are presented in the table below.

March 31, 2023 December 31, 2022

The carrying values and fair values of certain financial instruments that were not carried at fair value, excluding short-term financial instruments for which the carrying value approximates fair value, at June 30, 2023 and December 31, 2022 are presented in the table below.

June 30, 2023 December 31, 2022

Carrying Value Fair Value Carrying Value Fair Value

10 unchanged sentences

Our leases have remaining lease terms of less than 1 year to approximately 10 years, most of which generally include renewal options of varying terms.

Our total lease expense amounted to approximately $ 1.0 million and $ 1.1 million for the three months ended March 31, 2023 and 2022, respectively.

Our total lease expense amounted to approximately $ 0.9 million and $ 1.2 million for the three months ended June 30, 2023 and 2022, respectively, and $ 1.9 million and $ 2.3 million for the six months ended June 30, 2023 and 2022, respectively.

Our lease expense is generally based on fixed payments stated within the agreements.

2 unchanged sentences

Additional information related to our right of use assets and related lease liabilities is as follows:

March 31, 2023

June 30, 2023

Cash paid for operating lease liabilities (in thousands) $ 1,985

1 unchanged sentence

Weighted average discount rate 5.0 %

Maturities of our operating lease liabilities as of March 31, 2023 is as follows:

Maturities of our operating lease liabilities as of June 30, 2023 are as follows:

Operating Leases

8 unchanged sentences

Litigation and Claims

In the ordinary course of business, we are a party to various legal proceedings, including, from time to time, actions which are asserted to be maintainable as class action suits.

In the ordinary course of business, we are a party to various legal proceedings, including, from time to time, regulatory and governmental matters as well as actions which are asserted to be maintainable as class action suits.

We review these actions on an ongoing basis to determine whether it is probable and estimable that a loss has occurred and use that information when making accrual and disclosure decisions.

40 unchanged sentences

Revenues derived from our products sold at retail distributors constituting greater than 10% of our total operating revenues were as follows:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

Walmart 17 % 21 % 17 % 21 %

2 unchanged sentences

Note 18—Significant Retailer and Partner Concentration (continued)

In addition, approximately 32 % and 23 % of our total operating revenues for the three months ended March 31, 2023 and 2022, respectively, were generated from a single BaaS partner, but without a corresponding concentration to gross profit for the periods.

In addition, approximately 41 % and 29 % of our total operating revenues for the three months ended June 30, 2023 and 2022, respectively, and 36 % and 26 % for the six months ended June 30, 2023 and 2022, respectively, were generated from a single BaaS partner, but without a corresponding concentration to gross profit for the periods.

Note 19— Segment Information

18 unchanged sentences

The following tables present financial information for each of our reportable segments for the periods then ended:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

Segment Revenue (In thousands)

8 unchanged sentences

Segment revenue adjustments represent commissions and certain processing-related costs associated with our BaaS products and services, which are netted against our B2B Services revenues when evaluating segment performance, as well as certain other investment income earned by our bank, which is included in Corporate and Other.

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

Segment Profit (In thousands)

9 unchanged sentences

Impairment charges — 1,871 — 4,134

Legal settlement expenses 100 ( 426 )

Legal settlements and related expenses 1,319 13,921 1,419 13,495

Other expense 857 1,788 3,391 3,195

4 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements