PORT TOWNSEND, Wash., Sept. 18, 2025 (GLOBE NEWSWIRE) -- The Jefferson County Department of Public Works successfully conducted its first-ever online surplus property sale on GovDeals, the leading online marketplace for government agencies to sell real estate and other surplus assets. The county auctioned a 29.52-acre vacant land parcel located in Quilcene. The auction ran from August 6 to August 8 and ended with the parcel selling for a total of $387,000. “We chose to move this process online in an effort ...

Key TakeawaysXBO Ventures invested $25 million in Rapyd’s $500 million Series F round, joining major backers like BlackRock, Fidelity, and General Catalyst.The partnership grants XBO Ventures priority access to Rapyd’s fintech infrastructure, integrating crypto-native services such as liquidity, custodial solutions, and fiat ramps.Rapyd is expanding into Web3-ready payment solutions, with the deal marking a bridge between traditional finance and the digital asset economy.XBO Ventures, the investment arm of ...

Core Insights - Liquidity Services is offering two high-capacity (13.14 MW each) DRUPS systems from a large data storage manufacturer in California, available for immediate purchase [1][2] - The sale targets new data centers, semiconductor, pharmaceutical, and critical infrastructure operators, providing a premium backup power solution without long lead times [2] - The systems include complete switchgear, transformer distribution systems, sound suppression enclosures, and meet BAAQMD Tier 4 environmental control standards [2] Company Overview - AllSurplus is the leading online marketplace for surplus business assets, enabling sellers to manage listings efficiently with lower fees compared to traditional auction methods [4] - Liquidity Services, the parent company of AllSurplus, has a strong reputation in the surplus industry, having supported millions of customers globally [4]

Core Insights - Liquidity Services announced the sale of a fully equipped pressure-sensitive release liner manufacturing plant in Eden, North Carolina, in collaboration with Perry Equipment Company and Mark One Machinery [1] - The sale is conducted via a make offer format on AllSurplus, which is a leading online marketplace for surplus business assets [1][4] Company and Industry Summary - The sale presents a unique opportunity for manufacturers in the label, tape, medical, and industrial sectors to acquire a turnkey coating and converting operation, featuring modern capabilities and immediate production potential [2] - The facility includes advanced equipment such as extrusion and gravure coating lines, slitter rewinders, flexographic printing, robotic roll handling and wrapping systems, and more, all designed for producing silicone-coated paper and film liners [2] - AllSurplus, powered by Liquidity Services, offers a centralized platform for buyers to access surplus assets across various marketplaces, enhancing the efficiency of selling and purchasing industrial equipment [4] - Perry Equipment Company specializes in supplying used process equipment across multiple industries, providing machinery and services to maximize operational value [5] - Mark One Machinery focuses on the sale of used converting and extrusion equipment for the flexible packaging industry, emphasizing quality and tailored solutions for manufacturers [6]

Company Overview - Liquidity Services (NASDAQ:LQDT) is a leading global commerce company that operates the world's largest B2B e-commerce marketplace platform for surplus assets, with over $15 billion in completed transactions [2] - The company has more than five million qualified buyers and 15,000 corporate and government sellers worldwide [2] - Liquidity Services supports sustainability efforts by helping clients extend the life of assets, prevent unnecessary waste and carbon emissions, and reduce landfill contributions [2] Event Participation - Bill Angrick, Co-Founder, Chairman, and CEO of Liquidity Services, will present at the Midwest IDEAS conference on August 27, 2025, in Chicago, IL [1] - The conference will feature leaders and innovators engaging in one-on-one meetings to discuss emerging trends influencing the future [1]

Summary of Liquidity Services (LQDT) FY Conference Call - August 26, 2025 Company Overview - Liquidity Services is a leading e-commerce platform focused on the circular economy, helping organizations manage and monetize assets globally [3][4] - The company has established relationships with Fortune 500 and Fortune 1,000 companies, serving over 15,000 government entities and nearly 6 million registered buyers [4][3] Core Business Insights - Cumulative transaction activity on the platform has reached $15 billion, indicating significant value creation for buyers and sellers [4] - The company differentiates itself by focusing on the reutilization and remarketing of assets, which is a growing trend in supply chain management [3][4] - Liquidity Services operates a proprietary platform designed for the circular economy, integrating software, marketplace capabilities, and asset intelligence [5][6] Market Position and Growth - The circular economy market is valued at over $100 billion, with Liquidity Services positioned to capture significant market share through a two-sided marketplace approach [14] - The company is experiencing a digital shift, replacing outdated methods of managing used equipment with a streamlined transactional platform [14][15] - There is a notable increase in product obsolescence, creating opportunities for the company to facilitate asset transactions [15] Financial Performance - The company has set a GMV target of $2 billion, with a current run rate of approximately $1.6 billion [35] - GAAP revenue is derived from a mix of consignment fees, service fees, and subscription fees, with about 20% of GMV coming from a purchase model [35][36] - Liquidity Services has generated solid double-digit growth in EBITDA while investing in product innovation and customer relationship management [39][40] Segment Performance - The GovDeals segment achieved a record GMV of $252 million in the most recent quarter, highlighting the demand for asset recovery in the public sector [19] - The retail segment is adapting to the shift from in-person shopping to online, with high return rates driving the need for effective liquidation solutions [25][24] - The Capital Asset Group (CAG) segment serves industrial clients, providing a one-stop solution for asset management and sales [27] Strategic Initiatives - The company is leveraging AI and machine learning to enhance asset valuation and improve transaction efficiency [29][39] - Liquidity Services is exploring international growth opportunities, particularly in Central and South America, where e-commerce is rapidly expanding [47][48] - The company is also considering tuck-in acquisitions to enhance its service offerings and market reach [52][54] Sustainability and Transparency - Sustainability is a core component of the company's mission, with efforts to improve clients' carbon footprints and operationalize sustainability objectives [12][39] - Liquidity Services maintains a high level of transparency, with independent audits and public access to transaction data [12][13] Conclusion - Liquidity Services is well-positioned to capitalize on the growing circular economy, with a robust platform, strong financial performance, and strategic growth initiatives aimed at expanding its market presence and enhancing service offerings [3][14][39]

[Filing Information](index=1&type=section&id=Filing%20Information) [Form 10-Q Details](index=1&type=section&id=Form%2010-Q%20Details) This section details the company's quarterly report filing on Form 10-Q for the period ended June 30, 2025, identifying Liquidity Services, Inc. as an accelerated filer and providing key stock information and shares outstanding - Filing as a **Quarterly Report on Form 10-Q** for the period ended **June 30, 2025**[2](index=2&type=chunk) - Registrant: **LIQUIDITY SERVICES, INC.**, incorporated in Delaware, with Commission file number **0-51813**[2](index=2&type=chunk) - Company is an **Accelerated Filer**[3](index=3&type=chunk) Common Stock Information | Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered | |---|---|---| | Common Stock, $0.001 par value | LQDT | Nasdaq | **Shares Outstanding as of August 4, 2025:** **31,236,939 shares** [PART I. FINANCIAL INFORMATION](index=5&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) This section presents the unaudited condensed consolidated financial statements, including balance sheets, statements of operations, comprehensive income, stockholders' equity, and cash flows, along with detailed notes explaining accounting policies, acquisitions, earnings per share, leases, goodwill, intangible assets, income taxes, debt, stockholders' equity, fair value measurements, pension plans, legal proceedings, and segment information [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheets (Dollars in Thousands) | Metric | June 30, 2025 | September 30, 2024 | |---|---|---| | **Assets** | | | | Cash and cash equivalents | $155,605 | $153,226 | | Short-term investments | $11,353 | $2,310 | | Accounts receivable, net | $20,158 | $11,467 | | Inventory, net | $16,853 | $17,099 | | Total current assets | $220,007 | $199,235 | | Property and equipment, net | $18,187 | $17,961 | | Intangible assets, net | $14,096 | $13,912 | | Goodwill | $103,007 | $97,792 | | Total assets | $372,435 | $346,888 | | **Liabilities** | | | | Accounts payable | $58,797 | $58,693 | | Accrued expenses and other current liabilities | $25,363 | $28,261 | | Payables to sellers | $59,265 | $58,226 | | Total current liabilities | $153,895 | $155,153 | | Total liabilities | $163,785 | $164,328 | | **Stockholders' Equity** | | | | Total stockholders' equity | $208,650 | $182,560 | | Total liabilities and stockholders' equity | $372,435 | $346,888 | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Condensed Consolidated Statements of Operations (Dollars in Thousands, Except Per Share Data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | |---|---|---|---|---| | Purchase revenues | $76,517 | $53,396 | $237,159 | $142,726 | | Consignment and other fee revenues | $43,358 | $40,217 | $121,422 | $113,665 | | **Total revenue** | **$119,875** | **$93,613** | **$358,581** | **$256,391** | | Cost of goods sold | $65,110 | $44,212 | $206,220 | $119,960 | | Total costs and expenses | $109,657 | $85,718 | $334,473 | $240,253 | | Income from operations | $10,218 | $7,895 | $24,108 | $16,138 | | Income before provision for income taxes | $11,295 | $8,702 | $27,191 | $18,687 | | Provision for income taxes | $3,885 | $2,702 | $6,920 | $5,071 | | **Net income** | **$7,410** | **$6,000** | **$20,271** | **$13,616** | | Basic income per common share | $0.24 | $0.20 | $0.66 | $0.45 | | Diluted income per common share | $0.23 | $0.19 | $0.63 | $0.43 | [Condensed Consolidated Statements of Comprehensive Income](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) Condensed Consolidated Statements of Comprehensive Income (Dollars in Thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | |---|---|---|---|---| | Net income | $7,410 | $6,000 | $20,271 | $13,616 | | Foreign currency translation | $1,669 | $(110) | $267 | $391 | | Other comprehensive income (loss), net of taxes | $1,669 | $(110) | $267 | $391 | | **Comprehensive income** | **$9,079** | **$5,890** | **$20,538** | **$14,007** | [Condensed Consolidated Statement of Stockholders' Equity](index=8&type=section&id=Condensed%20Consolidated%20Statement%20of%20Stockholders%27%20Equity) Condensed Consolidated Statement of Stockholders' Equity (Dollars In Thousands) | Metric | September 30, 2024 | June 30, 2025 | |---|---|---| | Total Stockholders' Equity | $182,560 | $208,650 | | Net Income (9 months) | $10,033 (Retained Earnings) | $30,304 (Retained Earnings) | | Additional Paid-in Capital | $275,771 | $281,370 | | Treasury Stock | $(93,854) | $(93,901) | | Accumulated Other Comprehensive Loss | $(9,427) | $(9,160) | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Condensed Consolidated Statements of Cash Flows (Dollars In Thousands) | Metric | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | |---|---|---| | Net cash provided by operating activities | $28,768 | $48,215 | | Net cash used in investing activities | $(20,881) | $(17,646) | | Net cash used in financing activities | $(5,068) | $(10,825) | | Effect of exchange rate differences on cash and cash equivalents | $(440) | $287 | | Net decrease in cash and cash equivalents | $2,379 | $20,031 | | Cash and cash equivalents at beginning of period | $153,226 | $110,281 | | Cash and cash equivalents at end of period | $155,605 | $130,312 | [Notes to the Unaudited Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20the%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) [Note 1. Organization](index=10&type=section&id=Note%201.%20Organization) - **Liquidity Services, Inc.** is a **global commerce company** providing **online marketplace platforms** that power the **circular economy** by connecting buyers and sellers of surplus assets[24](index=24&type=chunk) - The company operates through **three reportable segments**: **GovDeals**, **Retail Supply Chain Group (RSCG)**, and **Capital Assets Group (CAG)**, with **Machinio and Software Solutions** combined for reporting[27](index=27&type=chunk) - Operations are subject to **various risks**, including dependence on the Internet, economic trends, technological change, competition, and collectability of payments[28](index=28&type=chunk) [Note 2. Summary of Significant Accounting Policies](index=10&type=section&id=Note%202.%20Summary%20of%20Significant%20Accounting%20Policies) - **Unaudited interim financial statements** are prepared in accordance with **U.S. GAAP** and **SEC rules**, including normal, recurring adjustments[29](index=29&type=chunk) - Management's estimates and assumptions are affected by **macroeconomic conditions** such as **international conflicts**, **tariffs**, and **market volatility**[32](index=32&type=chunk) Contract Assets and Liabilities (Dollars in Millions) | Metric | June 30, 2025 | September 30, 2024 | |---|---|---| | Contract assets | $1.5 | $1.5 | | Contract liabilities (Deferred revenue) | $5.2 | $4.8 | | Remaining performance obligation (Machinio & Software Solutions) | $5.2 | N/A | - **New accounting standards** (**ASU 2023-07**, **2023-09**, **2024-03**) will require enhanced disclosures for segment expenses, income tax reconciliation, and disaggregation of income statement expenses, with **no material change expected for ASU 2023-07**[42](index=42&type=chunk)[43](index=43&type=chunk)[44](index=44&type=chunk) [Note 3. Acquisitions](index=14&type=section&id=Note%203.%20Acquisitions) - On **January 31, 2025**, the Company acquired **Auction Software** for **$7.4 million** (**$6.5 million cash**, **$0.9 million stock**), allocating **$2.6 million to intangible assets** and **$5.1 million to goodwill** within the **Software Solutions segment**[45](index=45&type=chunk) - On **January 1, 2024**, the Company acquired **Sierra Auction Management, Inc.** for approximately **$13.7 million in cash**, allocating **$5.1 million to supplier relationships**, **$0.3 million to trade name assets**, and **$7.9 million to goodwill** within the **GovDeals segment**[47](index=47&type=chunk)[48](index=48&type=chunk) - Financial results from both acquisitions were **immaterial** to the condensed consolidated financial statements for the reported periods[46](index=46&type=chunk)[49](index=49&type=chunk) [Note 4. Earnings per Share](index=16&type=section&id=Note%204.%20Earnings%20per%20Share) - **Basic EPS** is calculated by dividing **net income** by **weighted-average common shares outstanding**, excluding **unvested restricted stock awards**[50](index=50&type=chunk) - **Diluted EPS** includes **potentially dilutive common shares** (stock options, RSUs, RSAs) using the **treasury stock method**, considering performance/market conditions[51](index=51&type=chunk)[52](index=52&type=chunk) Earnings Per Share (Dollars in Thousands, Except Per Share Data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | |---|---|---|---|---| | Net income | $7,410 | $6,000 | $20,271 | $13,616 | | Basic weighted average shares outstanding | 31,157,183 | 30,388,675 | 30,935,882 | 30,497,820 | | Diluted weighted average shares outstanding | 32,497,238 | 31,464,461 | 32,404,183 | 31,617,578 | | Basic income per common share | $0.24 | $0.20 | $0.66 | $0.45 | | Diluted income per common share | $0.23 | $0.19 | $0.63 | $0.43 | [Note 5. Leases](index=16&type=section&id=Note%205.%20Leases) - The Company holds **operating leases** for corporate offices, warehouses, vehicles, and equipment, with remaining terms **up to 5.2 years**[54](index=54&type=chunk)[55](index=55&type=chunk) Total Net Lease Cost (Dollars in Thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | |---|---|---|---|---| | Operating lease cost | $1,563 | $1,418 | $4,494 | $4,046 | | Operating lease impairment expense | $459 | $— | $459 | $— | | Total net lease cost | $2,531 | $1,809 | $6,271 | $5,196 | - During the **three months ended June 30, 2025**, the Company incurred **$0.5 million in impairment expense** due to exiting an **RSCG warehouse** for consolidation[55](index=55&type=chunk) Maturities of Lease Liabilities as of June 30, 2025 (Dollars in Thousands) | Years ending September 30, | Operating Leases | Finance Leases | |---|---|---| | Remainder of 2025 | $1,466 | $32 | | 2026 | $5,548 | $123 | | 2027 | $3,167 | $73 | | 2028 | $2,783 | $51 | | 2029 and thereafter | $2,662 | $127 | | Total lease liabilities | $14,159 | $357 | - **Non-cash adjustments to lease assets and liabilities** **increased significantly** in the **nine months ended June 30, 2025**, primarily due to the **renewal of a warehouse lease in Brampton, Ontario**, for the **RSCG segment**[56](index=56&type=chunk) [Note 6. Goodwill](index=17&type=section&id=Note%206.%20Goodwill) Goodwill Carrying Value by Segment (Dollars in Thousands) | Segment | September 30, 2024 | June 30, 2025 | |---|---|---| | GovDeals | $61,683 | $61,683 | | CAG | $21,551 | $21,696 | | Machinio & Software Solutions | $14,558 | $19,628 | | Total Goodwill | $97,792 | $103,007 | - **Goodwill increased by approximately $5.1 million** in the **Software Solutions business** during the **nine months ended June 30, 2025**, due to the **Auction Software acquisition**[57](index=57&type=chunk) - **No indicators of impairment** were identified for **goodwill** during the **three and nine months ended June 30, 2025**[58](index=58&type=chunk) [Note 7. Intangible Assets](index=18&type=section&id=Note%207.%20Intangible%20Assets) Intangible Assets, Net (Dollars in Thousands) | Intangible Asset Type | June 30, 2025 (Net Carrying Amount) | September 30, 2024 (Net Carrying Amount) | |---|---|---| | Customer and supplier relationships | $12,776 | $13,295 | | Technology | $825 | $61 | | Trade names | $347 | $397 | | Other intangibles | $148 | $159 | | **Total intangible assets, net** | **$14,096** | **$13,912** | - **Gross carrying amount of total intangible assets increased by $2.6 million** during the **nine months ended June 30, 2025**, due to the **Auction Software acquisition**[59](index=59&type=chunk) Expected Future Amortization of Intangible Assets as of June 30, 2025 (Dollars in Thousands) | Years ending September 30, | Expected Future Amortization | |---|---| | Remainder of 2025 | $783 | | 2026 | $3,128 | | 2027 | $3,045 | | 2028 | $3,009 | | 2029 and thereafter | $4,131 | | **Total** | **$14,096** | - **No impairment charges** were recorded on **intangible assets** or **material long-lived assets** during the reported periods[61](index=61&type=chunk) [Note 8. Income Taxes](index=18&type=section&id=Note%208.%20Income%20Taxes) - The **effective income tax rate** for the **nine months ended June 30, 2025**, was **25.4%**, down from **27.1%** in the prior year, primarily due to **increased tax benefits from stock compensation vesting, state and foreign taxes, and permanent tax adjustments**[62](index=62&type=chunk) - The **'One Big Beautiful Bill Act'** signed on **July 4, 2025**, is being evaluated for its tax reform provisions, but is **not expected to have a material impact** on financial statements for the reported period[63](index=63&type=chunk) - The Company did not record any **unrecognized tax benefits** during the **nine months ended June 30, 2025**, and has **no open income tax examinations in the U.S. for years prior to 2021**[64](index=64&type=chunk) [Note 9. Debt](index=18&type=section&id=Note%209.%20Debt) - On **May 7, 2025**, the Company amended its **Credit Agreement**, extending the maturity date to **March 31, 2027**, increasing the maximum principal amount from **$25.0 million** to **$35.0 million**, and raising the sublimit for **standby letters of credit** from **$10.0 million** to **$35.0 million**[69](index=69&type=chunk) - The applicable interest rate is a **variable rate** (**Daily Simple SOFR + 1.25% to 1.75% margin**), with monthly interest payments and quarterly unused commitment fees[70](index=70&type=chunk) - As of **June 30, 2025**, the Company had **no outstanding borrowings** under the **Line of Credit**, **$9.0 million in standby letters of credit**, and **$26.0 million of remaining borrowing capacity**[73](index=73&type=chunk) - The Company was in **full compliance** with all **financial and non-financial restrictive covenants** of the **Credit Agreement** as of **June 30, 2025**[72](index=72&type=chunk) [Note 10. Stockholders' Equity](index=21&type=section&id=Note%2010.%20Stockholders%27%20Equity) - The Company maintains the **Third Amended and Restated 2006 Omnibus Long-Term Incentive Plan (LTIP)**, with **1,289,677 shares of common stock** remaining available for use as of **June 30, 2025**[77](index=77&type=chunk) Share-Based Compensation Expense (Dollars in Thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | |---|---|---|---|---| | Stock options | $563 | $550 | $1,595 | $1,574 | | RSUs & RSAs | $2,949 | $2,067 | $7,927 | $5,634 | | **Total Equity-classified awards** | **$3,512** | **$2,617** | **$9,522** | **$7,208** | - **Stock options** and **RSUs/RSAs** granted during the **nine months ended June 30, 2025**, include both **service-based (vesting over four years)** and **performance-based conditions** (vesting upon achievement of specified financial targets)[79](index=79&type=chunk) - On **December 9, 2024**, the Board authorized an **additional $10.0 million for share repurchases** through **December 31, 2026**, bringing the **total remaining authorization to $17.6 million** as of **June 30, 2025**[82](index=82&type=chunk)[83](index=83&type=chunk) [Note 11. Fair Value Measurement](index=25&type=section&id=Note%2011.%20Fair%20Value%20Measurement) - The Company classifies fair value measurements into a **three-level hierarchy**: **Level 1 (quoted prices in active markets)**, **Level 2 (observable inputs other than quoted prices)**, and **Level 3 (unobservable inputs)**[86](index=86&type=chunk) - **Money market funds** (**$77.5 million** at **June 30, 2025**) and **guaranteed investment certificates** (**$11.4 million** at **June 30, 2025**) are classified as **Level 1 assets**[87](index=87&type=chunk)[88](index=88&type=chunk) - The **carrying values** of **cash, short-term investments, accounts receivable, accounts payable, and payables to sellers** **approximate their fair values**[90](index=90&type=chunk) [Note 12. Defined Benefit Pension Plan](index=25&type=section&id=Note%2012.%20Defined%20Benefit%20Pension%20Plan) - Certain employees of **Liquidity Services UK Limited (GoIndustry)** are covered by the **Henry Butcher Pension Fund and Life Assurance Scheme**, a **qualified defined benefit pension plan**[92](index=92&type=chunk) - The Company **guarantees GoIndustry's obligations** to the Scheme up to **£10 million British pounds**[92](index=92&type=chunk) - **Net periodic pension cost** was **$0.1 million** for both the **three months ended June 30, 2025 and 2024**, and **$0.1 million** and **$0.3 million** for the **nine months ended June 30, 2025 and 2024**, respectively[93](index=93&type=chunk) [Note 13. Legal Proceedings and Other Contingencies](index=25&type=section&id=Note%2013.%20Legal%20Proceedings%20and%20Other%20Contingencies) - A former CMO filed a complaint alleging **wrongful termination based on race and age and retaliation**; the Company is asserting substantial defenses and **cannot estimate potential liability**[95](index=95&type=chunk) - A former VP of Human Resources settled a **wrongful termination lawsuit** for **$3.5 million** in **August 2024**, with **CNA funding $3.0 million** and the **Company recording a $0.5 million litigation settlement expense in Q3 2024**[96](index=96&type=chunk) [Note 14. Segment Information](index=26&type=section&id=Note%2014.%20Segment%20Information) - The Company operates through **three reportable segments**: **GovDeals**, **Retail Supply Chain Group (RSCG)**, **Capital Assets Group (CAG)**, and a combined **Machinio & Software Solutions segment**[97](index=97&type=chunk) - **Segment direct profit** (**total revenue less cost of goods sold**) is used by the **CEO** to **assess segment performance**[99](index=99&type=chunk) Segment Revenue and Direct Profit (Three Months Ended June 30, 2025 vs. 2024, Dollars in Thousands) | Segment | Total Revenue 2025 | Total Revenue 2024 | Change (%) | Segment Direct Profit 2025 | Segment Direct Profit 2024 | Change (%) | |---|---|---|---|---|---|---| | GovDeals | $23,966 | $22,109 | 8.4% | $22,160 | $20,716 | 7.0% | | RSCG | $81,544 | $58,764 | 38.8% | $19,371 | $17,365 | 11.6% | | CAG | $9,161 | $8,650 | 5.9% | $8,460 | $7,430 | 13.9% | | Machinio & Software Solutions | $5,221 | $4,106 | 27.1% | $4,790 | $3,906 | 22.6% | | Consolidated Total | $119,875 | $93,613 | 28.1% | $54,764 | $49,401 | 10.9% | Segment Revenue and Direct Profit (Nine Months Ended June 30, 2025 vs. 2024, Dollars in Thousands) | Segment | Total Revenue 2025 | Total Revenue 2024 | Change (%) | Segment Direct Profit 2025 | Segment Direct Profit 2024 | Change (%) | |---|---|---|---|---|---|---| | GovDeals | $63,725 | $56,384 | 13.0% | $58,688 | $52,982 | 10.8% | | RSCG | $251,917 | $159,299 | 58.1% | $54,434 | $48,478 | 12.3% | | CAG | $28,604 | $28,764 | -0.6% | $25,909 | $23,611 | 9.7% | | Machinio & Software Solutions | $14,386 | $11,994 | 19.9% | $13,380 | $11,409 | 17.3% | | Consolidated Total | $358,581 | $256,391 | 39.9% | $152,360 | $136,431 | 11.7% | - Revenue from transactions outside the U.S. was **8.6% (Q3 2025)** and **9.0% (YTD 2025)** of **total revenues**, **down from 9.1% and 11.6%** in the prior year periods, respectively[102](index=102&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=29&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Company's financial condition and results of operations, including an overview of the business, macroeconomic conditions, industry trends, key business metrics, revenue recognition models, and a detailed analysis of consolidated and segment-level financial performance for the three and nine months ended June 30, 2025, compared to the prior year. It also discusses non-GAAP financial measures, liquidity, capital resources, and cash flow changes [Overview](index=29&type=section&id=Overview) - **Liquidity Services** is a **global commerce company** providing **online marketplace platforms** that power the **circular economy** by connecting millions of buyers and thousands of sellers of surplus assets[107](index=107&type=chunk) - The business model focuses on creating a **self-reinforcing cycle of value creation** through **online platforms**, attracting more participants and enhancing **network effects**[108](index=108&type=chunk) - The Company operates through **GovDeals**, **Retail Supply Chain Group (RSCG)**, **Capital Assets Group (CAG)**, and **Machinio & Software Solutions segments**[109](index=109&type=chunk)[110](index=110&type=chunk) [Macroeconomic Conditions](index=31&type=section&id=Macroeconomic%20Conditions) - **Tariffs and trade barriers** may impact buyers, sellers, and asset availability, with ongoing developments remaining **fluid and unpredictable**[111](index=111&type=chunk) - **Supply chain challenges** and **volatile used vehicle market prices**, along with **turbulent consumer behavior**, can **affect financial performance**[112](index=112&type=chunk) - **Inflation and heightened interest rates** have **increased prices for energy, shipping, and labor**, and **impacted borrowing costs, buyer qualification, and transaction timelines**[113](index=113&type=chunk) - **Ongoing international armed and geopolitical conflicts** (e.g., Russia-Ukraine, Israel) have heightened **global supply chain disruptions** and impacted **international trade markets**, though direct revenues from these regions were **not material**[115](index=115&type=chunk) [Industry Trends](index=31&type=section&id=Industry%20Trends) - **Positive long-term growth drivers** include **increased volume of returned merchandise**, **growing demand for sustainability solutions**, and **outsourcing of surplus disposition** by corporations and governments[116](index=116&type=chunk) - **Increased buyer demand for surplus merchandise** due to **environmental consciousness and value-seeking**, and a **preference for online solutions ensuring fair market value**, are also contributing factors[116](index=116&type=chunk) - **Innovation in the retail supply chain** is expected to **accelerate product obsolescence**, **increasing the supply of surplus assets**[116](index=116&type=chunk) [Our Marketplace Transactions](index=32&type=section&id=Our%20Marketplace%20Transactions) - The Company's marketplaces benefit from **greater scale and user adoption**, creating a **continuous flow of goods**[117](index=117&type=chunk) - As of **June 30, 2025**, the Company had **5.9 million registered buyers**, an **approximate 9% increase** from **5.4 million a year prior**[117](index=117&type=chunk)[128](index=128&type=chunk) [Revenues](index=32&type=section&id=Revenues) - **Revenue is primarily earned through** **Purchase model (resale of purchased inventory)** and **Consignment model (commission fees on seller-owned goods)** transactions, plus **other fee revenues**[118](index=118&type=chunk)[119](index=119&type=chunk)[120](index=120&type=chunk) Revenue Mix by Transaction Model | Metric | Three Months Ended June 30, 2025 | Nine Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Nine Months Ended June 30, 2024 | |---|---|---|---|---| | Consignment model GMV % | 82.5% | 80.9% | 86.5% | 86.0% | | Consignment revenues % of total | 30.0% | 28.1% | 35.9% | 36.5% | | Purchase model GMV % | 17.5% | 19.1% | 13.5% | 14.0% | | Purchase revenues % of total | 63.8% | 66.1% | 57.0% | 55.7% | | Other fee revenues % of total | 6.2% | 5.8% | 7.1% | 7.8% | - The Company was **not dependent on any single buyer in a material manner** for the reported periods[123](index=123&type=chunk) [Key Business Metrics](index=34&type=section&id=Key%20Business%20Metrics) Key Business Metrics (Dollars in Millions, except for counts) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | |---|---|---|---|---| | Gross Merchandise Volume (GMV) | $413.0 | $380.4 | $1,166.4 | $1,005.7 | | GMV Change (YoY) | +8.6% | N/A | +16.0% | N/A | | Total registered buyers (as of period end) | 5.9 million | 5.4 million | 5.9 million | 5.4 million | | Total auction participants | 1,098,000 | 1,016,000 | 3,040,000 | 3,003,000 | | Completed transactions | 286,000 | 263,000 | 797,000 | 802,000 | [Components of Revenue and Expenses](index=34&type=section&id=Components%20of%20Revenue%20and%20Expenses) - **Technology expenses** primarily consist of costs for **technical staff, third-party services, licenses, and infrastructure** for marketplace platforms and operational systems, net of **capitalized software development costs**[134](index=134&type=chunk) - **Operations expenses** cover **warehouse operations, shipping logistics, inventory management, refurbishment, customer support, and field support**[136](index=136&type=chunk) - **Sales and marketing expenses** include **personnel costs, lead generation, marketing campaigns (online/offline), and trade shows**[137](index=137&type=chunk) - **General and administrative expenses** are **corporate and administrative functions**, generally more **fixed in nature**[138](index=138&type=chunk) - **Other operating expenses, net**, include **acquisition-related costs, impairment, lease terminations, and business realignment expenses**[139](index=139&type=chunk) - **Interest and other income, net**, includes **interest income, credit agreement fees, pension costs, and foreign currency fluctuations**[140](index=140&type=chunk) - **Income taxes** include **current and deferred income tax expense** for **U.S. federal, state, and foreign jurisdictions**, estimated using an **annual effective tax rate**[141](index=141&type=chunk) [Results of Operations](index=35&type=section&id=Results%20of%20Operations) Consolidated Operating Results (Dollars in Thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change ($) | Change (%) | |---|---|---|---|---| | Total revenue | $119,875 | $93,613 | $26,262 | 28.1% | | Cost of goods sold | $65,110 | $44,212 | $20,898 | 47.3% | | Total costs and expenses | $109,657 | $85,718 | $23,939 | 27.9% | | Income from operations | $10,218 | $7,895 | $2,323 | 29.4% | | Net income | $7,410 | $6,000 | $1,410 | 23.5% | | Metric | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | Change ($) | Change (%) | |---|---|---|---|---| | Total revenue | $358,581 | $256,391 | $102,190 | 39.9% | | Cost of goods sold | $206,220 | $119,960 | $86,260 | 71.9% | | Total costs and expenses | $334,473 | $240,253 | $94,220 | 39.2% | | Income from operations | $24,108 | $16,138 | $7,970 | 49.4% | | Net income | $20,271 | $13,616 | $6,655 | 48.9% | - **GovDeals revenue increased 8.4% (Q3) and 13.0% (YTD)** due to **new seller acquisition and service expansion**, despite **lower vehicle market prices**[144](index=144&type=chunk)[154](index=154&type=chunk) - **RSCG revenue increased 38.8% (Q3) and 58.1% (YTD)** driven by **increased GMV from existing and new retail client programs** and **higher volumes from client purchase model programs**[146](index=146&type=chunk)[155](index=155&type=chunk) - **CAG revenue increased 5.9% (Q3) but decreased 0.6% (YTD)**, with **Q3 growth from heavy equipment consignment sales**, while YTD was impacted by **fewer large international spot purchase transactions**[147](index=147&type=chunk)[156](index=156&type=chunk) - **Machinio & Software Solutions revenue increased 27.1% (Q3) and 19.9% (YTD)** due to **Machinio price increases, subscriber growth, and the Auction Software acquisition**[148](index=148&type=chunk)[157](index=157&type=chunk) - **Cost of goods sold increased significantly (47.3% Q3, 71.9% YTD)** primarily due to **increased purchase transaction volumes in the RSCG segment**[149](index=149&type=chunk)[158](index=158&type=chunk) - **General and administrative expenses decreased 4.4% (Q3) and 1.0% (YTD)**, mainly due to a **$0.5 million litigation settlement expense in Q3 2024 not recurring**, and **ongoing cost management**[152](index=152&type=chunk)[161](index=161&type=chunk) - **Depreciation and amortization decreased (16.9% Q3, 16.7% YTD)** as **historically acquired intangible assets reached the end of their useful lives**[152](index=152&type=chunk)[162](index=162&type=chunk) [Non-GAAP Financial Measures](index=40&type=section&id=Non-GAAP%20Financial%20Measures) - **Non-GAAP EBITDA** is **Net income** adjusted for **Interest and other income** (excluding non-service pension costs), **Provision for income taxes**, and **Depreciation and amortization**[164](index=164&type=chunk) - **Non-GAAP Adjusted EBITDA** further adjusts **Non-GAAP EBITDA** for **stock-based compensation, acquisition costs, business realignment expense, deferred revenue purchase accounting adjustments, and impairment charges**[164](index=164&type=chunk) - These **non-GAAP measures** are used by management for **evaluating performance, planning, resource allocation, and assessing operational strategies**, and are considered **useful for investors to compare performance consistently**[165](index=165&type=chunk)[167](index=167&type=chunk)[170](index=170&type=chunk) Reconciliation of Net Income to Non-GAAP EBITDA and Non-GAAP Adjusted EBITDA (Dollars in Thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | |---|---|---|---|---| | Net income | $7,410 | $6,000 | $20,271 | $13,616 | | EBITDA | $12,825 | $11,010 | $31,701 | $25,181 | | Stock compensation expense | $3,512 | $2,617 | $9,522 | $7,208 | | Acquisition-related costs and litigation settlement expense | $50 | $1,080 | $286 | $1,657 | | Business realignment expenses | $618 | $— | $777 | $— | | **Non-GAAP Adjusted EBITDA** | **$17,005** | **$14,707** | **$42,286** | **$34,046** | [Liquidity and Capital Resources](index=43&type=section&id=Liquidity%20and%20Capital%20Resources) - **Operational cash needs** are funded by **existing cash balances and cash generated from operations**, with **no historical or foreseeable dividend payments**[174](index=174&type=chunk) - As of **June 30, 2025**, the Company had **$155.6 million in Cash and cash equivalents** and **$11.4 million in Short-term investments**, deemed **sufficient for anticipated cash needs for at least one year**[174](index=174&type=chunk) - The Company intends to **indefinitely reinvest foreign subsidiary earnings** (**$9.1 million undistributed** as of **June 30, 2025**) outside the U.S. to **avoid adverse tax consequences upon repatriation**[176](index=176&type=chunk) - **Capital expenditures** for the **nine months ended June 30, 2025**, were **$5.8 million**, a **decrease from $6.1 million** in the prior year, primarily due to **timing of platform enhancements**[177](index=177&type=chunk) - The **Credit Agreement** was amended on **May 7, 2025**, extending maturity to **March 31, 2027**, and increasing the **maximum principal amount to $35.0 million** and **standby letter of credit sublimit to $35.0 million**[181](index=181&type=chunk) - As of **June 30, 2025**, the Company had **$26.0 million of remaining borrowing capacity** under the **Credit Agreement**, with **no outstanding borrowings**[182](index=182&type=chunk) - **Net cash provided by operating activities decreased by $19.4 million to $28.8 million** for the **nine months ended June 30, 2025**, primarily due to **changes in accounts receivable and payables to sellers**[189](index=189&type=chunk) - **Net cash used in investing activities increased by $3.3 million to $20.9 million**, driven by a **$14.0 million increase in short-term investment purchases**, partially offset by **decreased business acquisition cash payments**[191](index=191&type=chunk) - **Net cash used in financing activities decreased by $5.7 million to $5.1 million**, mainly due to a **$9.4 million decrease in share repurchases**, partially offset by **increased taxes paid for stock compensation**[192](index=192&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=47&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section discusses the Company's exposure to market risks, specifically interest rate sensitivity and exchange rate sensitivity, and the potential impact of these risks on its financial performance - A **hypothetical 100 basis point decline in interest rates** would impact **pre-tax earnings by less than $1.0 million annually**[194](index=194&type=chunk) - The Company has **no debt as of June 30, 2025**, but future draws on the **Line of Credit** would incur **variable interest based on SOFR**[195](index=195&type=chunk) - **Primary foreign exchange exposures** include **British Pounds, Canadian Dollars, Chinese Yuan, Euros, and Hong Kong Dollars**[197](index=197&type=chunk) - A **hypothetical 10% decrease in foreign exchange rates** would **reduce total expected revenues by approximately 1%**, with a **smaller impact on pre-tax earnings**[197](index=197&type=chunk) [Item 4. Controls and Procedures](index=47&type=section&id=Item%204.%20Controls%20and%20Procedures) This section details the evaluation of the Company's disclosure controls and procedures and reports on any changes in internal control over financial reporting - As of **June 30, 2025**, management, including the **CEO and CFO**, concluded that **disclosure controls and procedures were effective** in providing **reasonable assurance for timely and accurate reporting**[199](index=199&type=chunk) - **No material changes** occurred in **internal control over financial reporting** during the **three months ended June 30, 2025**[200](index=200&type=chunk) [PART II. OTHER INFORMATION](index=48&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=48&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 13 of the financial statements for information on legal proceedings, indicating that no new material litigation has arisen - Information regarding **legal proceedings** is detailed in **Note 13** to the **condensed consolidated financial statements**[202](index=202&type=chunk) [Item 1A. Risk Factors](index=48&type=section&id=Item%201A.%20Risk%20Factors) This section states that there have been no material changes to the risk factors previously disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2024 - **No material changes** from the **risk factors** disclosed in the **Annual Report on Form 10-K** for the fiscal year ended **September 30, 2024**[203](index=203&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=48&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section reports that there were no unregistered sales of equity securities and provides details on the Company's share repurchase program - **No unregistered sales of equity securities** occurred during the period[204](index=204&type=chunk) - The Company made **no repurchases** under its **share repurchase program** during the **three months ended June 30, 2025**[207](index=207&type=chunk) - As of **June 30, 2025**, the Company had **$17.6 million of remaining authorization** to **repurchase shares through December 31, 2026**[210](index=210&type=chunk) [Item 5. Other Information](index=49&type=section&id=Item%205.%20Other%20Information) This section states that there is no other information to report under this item - **No other information to report**[211](index=211&type=chunk) [Item 6. Exhibits](index=50&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed as part of the Form 10-Q, including corporate documents, certifications, and XBRL data - Includes **Fourth Amended and Restated Certificate of Incorporation**, **Amended and Restated Bylaws**, and **various certifications (CEO, CFO)** as **exhibits**[212](index=212&type=chunk) - **XBRL formatted financial statements** (**Balance Sheets, Statements of Operations, Comprehensive Income, Stockholders' Equity, Cash Flows, and Notes**) are included as **Exhibit 101**[212](index=212&type=chunk) [SIGNATURES](index=51&type=section&id=SIGNATURES) This section contains the required signatures from the registrant's authorized officers, including the Chairman of the Board and Chief Executive Officer, and the Chief Financial Officer - Report signed by **William P. Angrick, III** (**Chairman of the Board of Directors and Chief Executive Officer**) and **Jorge A. Celaya** (**Chief Financial Officer**) on **August 7, 2025**[214](index=214&type=chunk)

Financial Data and Key Metrics Changes - The company achieved a record Gross Merchandise Volume (GMV) of $413 million, representing a 9% year-over-year growth [16] - Revenue increased by 28% to $119.9 million, consistent with the guidance provided for the revenue to GMV ratio [16] - GAAP earnings per share rose by 21% to $0.23, while non-GAAP adjusted earnings per share increased by 13% to $0.34 [17] - Adjusted EBITDA for the fiscal third quarter was $17 million, a 16% increase year-over-year, with a 31% adjusted EBITDA margin on total segment direct profit [17] Business Line Data and Key Metrics Changes - The GovDeals segment recorded GMV of $252 million, with revenue up 8% and direct profit margin up 7%, setting new quarterly records [17] - The retail segment saw a 30% increase in GMV and a 39% increase in revenue year-over-year, with direct profit growing by 12% [18] - The Capital Asset Group (CAG) segment experienced a 12% increase in GMV, 6% in revenue, and 14% in direct profit, driven by a more than doubling of heavy equipment asset sales [19] - The Machinio and Software Solutions segments increased revenue by 27% and direct profit by 23% [19] Market Data and Key Metrics Changes - The company noted tempered activity in certain industrial categories within the CAG segment due to economic and tariff-related supply chain uncertainties [19] - The GovDeals segment continues to expand in new geographies, including notable new account wins in California and Florida [9] Company Strategy and Development Direction - The company is focused on capturing greater market share through strategic investments in software, platform innovation, and marketing [7] - A new consumer auction experience is being piloted in Columbus, Ohio, aimed at leveraging auction software technology to create a direct-to-consumer channel [29][42] - The company is transitioning away from selected purchase model programs to focus on higher-margin consignment relationships [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to drive sustainable long-term growth despite economic uncertainties related to tariffs and interest rates [6] - The company anticipates double-digit growth in adjusted EBITDA for the full year of 2025, with a strong financial foundation and zero debt [15][20] - Management highlighted the importance of adapting to changing market conditions and optimizing resource allocation to higher-margin activities [35] Other Important Information - The company ended the quarter with $167 million in cash and cash equivalents, with zero financial debt [15] - The company is establishing online B2C auctions to enhance market recovery and expand market share [12] Q&A Session Summary Question: Discussion on tariff impacts - Management noted that international activity is affected by evolving negotiations, causing delays in asset trading, but domestic used equipment is moving normally [26][27] Question: Details on the e-commerce program in Columbus - The company is piloting a consumer auction experience in Columbus, leveraging auction software for a direct-to-consumer channel [29][30] Question: Process of turning off certain purchase flows - Management explained that they periodically review business commitments and reallocate resources to higher-margin activities when necessary [33][35] Question: Timing of new business development impacts - New business wins may take a few months to impact financial results, depending on the client and the breadth of services [39] Question: Consumer auction software deployment - This is the first deployment of consumer auction software, aimed at creating a vibrant direct-to-consumer channel [42][43]

Company Overview - Liquidity Services operates a global commerce company powering the Circular Economy[7] - The company has over 15,000 trusted clients worldwide and has completed over 1 million transactions annually in 100+ countries[14] - Liquidity Services has completed over $10 billion in transactions[14] Financial Performance - Q3 Fiscal Year 2025 Gross Merchandise Volume (GMV) reached $413 million[63] - Q3 Fiscal Year 2025 Revenue reached $120 million[65] - Q3 Fiscal Year 2025 Non-GAAP Adjusted EBITDA reached $17 million[68] Segment Performance - GovDeals segment GMV for Q3 Fiscal Year 2025 was $252.3 million[41] - RSCG segment GMV for Q3 Fiscal Year 2025 was $102.6 million[47] - CAG segment GMV for Q3 Fiscal Year 2025 was $58.2 million[53] - Machinio segment revenue for Q3 Fiscal Year 2025 was $4.4 million[57] Marketplace Growth - AllSurplus marketplace saw an 18% increase in buyer registrations in Q3 Fiscal Year 2025[38] - GovDeals marketplace saw a 19% increase in buyer registrations, a 22% increase in auction participants, and a 15% increase in completed transactions in Q3 Fiscal Year 2025[38] - Liquidationcom marketplace saw a 2% increase in buyer registrations in Q3 Fiscal Year 2025[38]

[Executive Summary](index=1&type=section&id=Executive%20Summary) Liquidity Services achieved record GMV and double-digit earnings growth in Q3 FY25, driven by strategic investments and marketplace expansion [Company Overview and Q3 FY25 Performance Highlights](index=1&type=section&id=Company%20Overview%20and%20Q3%20FY25%20Performance%20Highlights) Liquidity Services reported strong Q3 FY25 results with record GMV and double-digit earnings growth, reflecting successful strategic investments - Liquidity Services attributes strong Q3 FY25 financial results to leading technology-enabled marketplaces, growing buyer network, and disciplined execution[1](index=1&type=chunk) - Strategic investments in software, platform innovation, marketing, and sales are enabling greater market share capture and enhanced value for sellers and buyers[1](index=1&type=chunk) Q3 FY25 Consolidated Financial Highlights (YoY Growth) | Metric | Q3 FY25 Value (in millions) | Q3 FY24 Value (in millions) | YoY Change | | :----------------------------- | :-------------------------- | :-------------------------- | :--------- | | Gross Merchandise Volume (GMV) | $413.0 | $380.4 | +9% | | Revenue | $119.9 | $93.6 | +28% | | GAAP Net Income | $7.4 | $6.0 | +24% | | GAAP Diluted EPS | $0.23 (dollars) | $0.19 (dollars) | +21% | | Non-GAAP Adjusted EBITDA | $17.0 | $14.7 | +16% | | Non-GAAP Adjusted EPS | $0.34 (dollars) | $0.30 (dollars) | +13% | | Cash balances | $167.0 | N/A | N/A | [Third Quarter Fiscal Year 2025 Financial Results](index=1&type=section&id=Third%20Quarter%20Fiscal%20Year%202025%20Financial%20Results) This section details Liquidity Services' consolidated and segment-specific financial performance for Q3 FY25, including key operational metrics [Consolidated Financial Highlights](index=1&type=section&id=Consolidated%20Financial%20Highlights) Q3 FY25 saw significant year-over-year growth in key financial metrics, including record GMV and revenue, with double-digit increases in GAAP and Non-GAAP earnings Q3 FY25 Consolidated Financial Performance (YoY) | Metric | Q3 FY25 (in millions) | Q3 FY24 (in millions) | Change | | :----------------------------- | :-------------------- | :-------------------- | :----- | | GMV | $413.0 | $380.4 | +9% | | Revenue | $119.9 | $93.6 | +28% | | GAAP Net Income | $7.4 | $6.0 | +24% | | GAAP Diluted EPS | $0.23 (dollars) | $0.19 (dollars) | +21% | | Non-GAAP Adjusted EBITDA | $17.0 | $14.7 | +16% | | Non-GAAP Adjusted Net Income | $11.1 | $9.5 | +17% | | Non-GAAP Adjusted EPS | $0.34 (dollars) | $0.30 (dollars) | +13% | | Cash balances | $167.0 | N/A | N/A | - Consignment sales represented **83% of consolidated GMV** for Q3 FY25[7](index=7&type=chunk) [Segment Financial Results](index=3&type=section&id=Segment%20Financial%20Results) All reportable segments contributed to Q3 FY25 growth, with RSCG and Machinio & Software Solutions showing particularly strong revenue increases - Segment direct profit is calculated as total revenue less cost of goods sold (excluding depreciation and amortization)[8](index=8&type=chunk) [GovDeals](index=3&type=section&id=GovDeals) GovDeals achieved record quarterly GMV and revenue in Q3 FY25, driven by new seller acquisition and service expansion, with revenue growth outpacing GMV GovDeals Q3 FY25 Performance (YoY) | Metric | Q3 FY25 (in thousands) | Q3 FY24 (in thousands) | YoY Change | | :------------------ | :--------------------- | :--------------------- | :--------- | | GMV | $252,291 | $249,652 | +1% | | Total revenue | $23,966 | $22,109 | +8% | | Segment direct profit | $22,160 | $20,716 | +7% | | % of Total revenue | 92% | 94% | -2 ppts | - Growth from new seller acquisition, service expansion, and record seller listing activity were partially offset by lower market prices for vehicles and lower take-rate real estate foreclosure auction activity[7](index=7&type=chunk) [RSCG](index=3&type=section&id=RSCG) RSCG saw substantial Q3 FY25 GMV and revenue growth from retail client expansion and increased purchase model volumes, achieving record direct profit RSCG Q3 FY25 Performance (YoY) | Metric | Q3 FY25 (in thousands) | Q3 FY24 (in thousands) | YoY Change | | :------------------ | :--------------------- | :--------------------- | :--------- | | GMV | $102,556 | $78,950 | +30% | | Total revenue | $81,544 | $58,764 | +39% | | Segment direct profit | $19,371 | $17,365 | +12% | | % of Total revenue | 24% | 30% | -6 ppts | [CAG](index=3&type=section&id=CAG) CAG's GMV increased by **12%** in Q3 FY25, driven by heavy equipment consignment sales, with revenue up **6%** despite economic uncertainties CAG Q3 FY25 Performance (YoY) | Metric | Q3 FY25 (in thousands) | Q3 FY24 (in thousands) | YoY Change | | :------------------ | :--------------------- | :--------------------- | :--------- | | GMV | $58,160 | $51,838 | +12% | | Total revenue | $9,161 | $8,650 | +6% | | Segment direct profit | $8,460 | $7,430 | +14% | | % of Total revenue | 92% | 86% | +6 ppts | - Certain industrial categories and regions experienced tempered activity due to economic and tariff-related supply chain uncertainty[7](index=7&type=chunk) [Machinio & Software Solutions](index=3&type=section&id=Machinio%20%26%20Software%20Solutions) Machinio & Software Solutions achieved a **27%** revenue increase in Q3 FY25, driven by subscription growth, pricing adjustments, and the Auction Software acquisition Machinio & Software Solutions Q3 FY25 Performance (YoY) | Metric | Q3 FY25 (in thousands) | Q3 FY24 (in thousands) | YoY Change | | :------------------ | :--------------------- | :--------------------- | :--------- | | Total revenue | $5,221 | $4,106 | +27% | | Segment direct profit | $4,790 | $3,906 | +23% | | % of Total revenue | 92% | 95% | -3 ppts | [Operational Metrics](index=4&type=section&id=Operational%20Metrics) Q3 FY25 operational metrics showed healthy growth in buyer engagement and transaction volume, with significant year-over-year increases across key indicators Q3 FY25 Operational Metrics (YoY) | Metric | Q3 FY25 (in millions) | Q3 FY24 (in millions) | YoY Change | | :---------------------- | :-------------------- | :-------------------- | :--------- | | Registered Buyers | 5.9 | 5.4 | +9% | | Auction Participants | 1,098,000 (in thousands) | 1,016,000 (in thousands) | +8% | | Completed Transactions | 286,000 (in thousands) | 263,000 (in thousands) | +9% | [Fourth Quarter Fiscal Year 2025 Business Outlook](index=5&type=section&id=Fourth%20Quarter%20Fiscal%20Year%202025%20Business%20Outlook) This section provides Liquidity Services' Q4 FY25 guidance, segment-specific outlooks, and key trends and assumptions influencing future financial performance [Q4 FY25 Guidance](index=5&type=section&id=Q4%20FY25%20Guidance) Liquidity Services anticipates solid double-digit annual growth for FY25, with Q4 guidance reflecting seasonality and continued year-over-year growth in most segments Q4 FY25 Guidance | Metric | Q4 FY25 Guidance Range | | :-------------------------- | :--------------------- | | GMV | $355 to $390 million | | GAAP Net Income | $5.0 to $8.0 million | | Non-GAAP Adjusted EBITDA | $13.0 to $16.0 million | | GAAP Diluted EPS | $0.15 to $0.25 (dollars) | | Non-GAAP Adjusted Diluted EPS | $0.24 to $0.34 (dollars) | - Consolidated consignment GMV is expected to remain in the low eighties as a percentage of total GMV[17](index=17&type=chunk) - Consolidated revenue as a percentage of GMV is expected to be slightly below **thirty percent**[17](index=17&type=chunk) - Total segment direct profits as a percentage of consolidated revenue are expected to be in the **mid-forty percent range**[17](index=17&type=chunk) [Segment-Specific Outlook](index=5&type=section&id=Segment-Specific%20Outlook) Q4 FY25 projects solid year-over-year growth for CAG and GovDeals, flat GMV and revenue for RSCG, and continued growth for Machinio and Software Solutions - CAG segment is expected to grow its top-line year-over-year, led by the heavy equipment category, despite economic uncertainties[14](index=14&type=chunk) - GovDeals, Machinio, and newly established Software Solutions businesses are expected to continue year-over-year growth[14](index=14&type=chunk) - RSCG's GMV and revenue are expected to be flat year-over-year for Q4 FY25, with segment direct profit slightly down due to product mix and pricing changes[15](index=15&type=chunk) - Start-up costs for the expansion of RSCG's direct-to-consumer online auction and local pick-up initiative in Columbus, Ohio, are included in guidance[16](index=16&type=chunk) [Key Trends and Assumptions](index=5&type=section&id=Key%20Trends%20and%20Assumptions) Q4 FY25 outlook considers transaction and product mix fluctuations, digital economy adoption, economic conditions, and ongoing R&D and business development investments [Potential Impacts to GMV, Revenue, Segment Direct Profits](index=5&type=section&id=Potential%20Impacts%20to%20GMV%2C%20Revenue%2C%20Segment%20Direct%20Profits) GMV, revenue, and segment direct profits are influenced by transaction mix, RSCG inventory, GovDeals real estate timing, digital economy adoption, and economic conditions - Fluctuations in the mix of purchase and consignment transactions can impact revenue as a percent of GMV and segment direct profit as a percentage of revenue[17](index=17&type=chunk) - Variability in RSCG's inventory product mix can cause changes in revenues and/or segment direct profit as a percentage of revenue[17](index=17&type=chunk) - Real estate transactions in GovDeals are subject to significant variability due to postponements, cancellations, or changes in property values[17](index=17&type=chunk) - Continued growth is expected from the acceleration of broader market adoption of the digital economy, particularly in GovDeals and RSCG[17](index=17&type=chunk) - Changes in economic, political, or international trading conditions could impact operating results by affecting sellers' or buyers' financial stability[18](index=18&type=chunk) [Potential Impacts to Operating Expenses](index=7&type=section&id=Potential%20Impacts%20to%20Operating%20Expenses) Operating expenses may be impacted by R&D spending, business development investments, and RSCG warehouse operating requirements due to product volumes - Continued R&D spending to support software solutions and enhance marketing, analytics, and payment optimization[21](index=21&type=chunk) - Spending in business development activities to capture market opportunities with efficient payback periods[21](index=21&type=chunk) - Variability in volumes and sourcing locations of products handled by RSCG can cause fluctuations in warehouse capacity and related operating expense requirements[21](index=21&type=chunk) [Potential Impacts to GAAP Net Income and EPS and Non-GAAP Adjusted Net Income and Adjusted EPS](index=7&type=section&id=Potential%20Impacts%20to%20GAAP%20Net%20Income%20and%20EPS%20and%20Non-GAAP%20Adjusted%20Net%20Income%20and%20Adjusted%20EPS) Net income and EPS impacts include stock compensation fluctuations, an FY25 ETR of **25% to 31%**, and increased cash taxes due to full NOL utilization in Q2-25 - Changes in financial performance could cause fluctuations in stock compensation expense for performance-based awards[21](index=21&type=chunk) - FY25 annual effective tax rate (ETR) is expected to range from approximately **25% to 31%**, with Q4-25 tax expense potentially appearing higher (low-to-mid **30% range**) due to normalization from earlier discrete benefits[21](index=21&type=chunk) - Cash paid for income taxes is expected to increase in FY25 as the remaining US federal net operating loss carryforward position was fully utilized in Q2-25[21](index=21&type=chunk) - Diluted weighted average shares outstanding are expected to be approximately **32.5 to 33.0 million**[21](index=21&type=chunk) [Non-GAAP Financial Measures and Reconciliations](index=8&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Reconciliations) This section provides reconciliations of GAAP Net Income to Non-GAAP EBITDA, Adjusted EBITDA, Adjusted Net Income, and Adjusted EPS, along with explanations of these non-GAAP measures [Non-GAAP EBITDA and Adjusted EBITDA Reconciliation](index=8&type=section&id=Non-GAAP%20EBITDA%20and%20Adjusted%20EBITDA%20Reconciliation) This section reconciles GAAP Net Income to Non-GAAP EBITDA and Adjusted EBITDA, excluding items not indicative of core operating performance Reconciliation of Net Income to Non-GAAP EBITDA and Adjusted EBITDA (Three Months Ended June 30, in thousands) | Metric | 2025 | 2024 | | :----------------------------- | :--- | :--- | | Net income | $7,410 | $6,000 | | Interest and other income, net | $(1,127) | $(891) | | Provision for income taxes | $3,885 | $2,702 | | Depreciation and amortization | $2,657 | $3,199 | | **Non-GAAP EBITDA** | **$12,825** | **$11,010** | | Stock compensation expense | $3,512 | $2,617 | | Acquisition-related costs | $50 | $1,080 | | Business realignment expenses | $618 | — | | **Non-GAAP Adjusted EBITDA** | **$17,005** | **$14,707** | [Non-GAAP Adjusted Net Income and EPS Reconciliation](index=9&type=section&id=Non-GAAP%20Adjusted%20Net%20Income%20and%20EPS%20Reconciliation) This section reconciles Non-GAAP Adjusted Net Income and EPS, adjusting for stock compensation, intangible amortization, acquisition costs, and tax impacts Reconciliation of Net Income to Non-GAAP Adjusted Net Income and EPS (Three Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | | :------------------------------------------ | :------------------ | :------------------ | | Net income | $7,410 | $6,000 | | Stock compensation expense | $3,512 | $2,617 | | Intangible asset amortization | $828 | $1,084 | | Acquisition-related costs | $50 | $1,080 | | Business realignment expenses | $618 | — | | Income tax impact on the adjustment items | $(1,272) | $(1,291) | | **Non-GAAP Adjusted net income** | **$11,146** | **$9,490** | | Non-GAAP Adjusted basic earnings per share | $0.36 (dollars) | $0.31 (dollars) | | Non-GAAP Adjusted diluted earnings per share | $0.34 (dollars) | $0.30 (dollars) | | Basic weighted average shares outstanding | 31,157,183 | 30,388,675 | | Diluted weighted average shares outstanding | 32,497,238 | 31,464,461 | - Tax rates used to estimate the impact of income taxes on non-GAAP adjustments were **25%** for Q3 FY25 and **27%** for Q3 FY24[25](index=25&type=chunk) [Explanation of Non-GAAP Measures](index=10&type=section&id=Explanation%20of%20Non-GAAP%20Measures) Non-GAAP measures like EBITDA, Adjusted EBITDA, and Adjusted EPS are used to clarify core financial performance for investors and internal planning, not to replace GAAP results - Non-GAAP measures are provided to enhance investors' overall understanding of current financial performance and future prospects[29](index=29&type=chunk) - Non-GAAP Adjusted EBITDA eliminates the impact of items not considered indicative of core operating performance[30](index=30&type=chunk) - The company does not quantitatively reconcile guidance ranges for non-GAAP measures to comparable GAAP measures in the Business Outlook section due to the inherent variability and scenario-based process of preparing guidance[32](index=32&type=chunk) [Supplemental Operating Data Explanation](index=10&type=section&id=Supplemental%20Operating%20Data%20Explanation) Supplemental operating data, including GMV, registered buyers, and transactions, measures performance and investment effectiveness, providing insight into marketplace activity - GMV is the total sales value of all transactions for which compensation was earned through marketplaces or other channels[33](index=33&type=chunk) - Supplemental operating data helps evaluate the effectiveness of investments in seller/buyer support, value-added services, product development, sales/marketing, and operations[33](index=33&type=chunk) - This data should be considered in addition to GAAP financial information, not as a substitute or superior to it[33](index=33&type=chunk) [Forward-Looking Statements](index=12&type=section&id=Forward-Looking%20Statements) This document contains forward-looking statements subject to risks and uncertainties that may cause actual results to differ, with past performance not guaranteeing future outcomes - Forward-looking statements are predictions subject to known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially[34](index=34&type=chunk) - Important factors that could cause actual results to differ are set forth in SEC filings, including risks related to asset sourcing, competitive environment, IT systems, employee retention, economic conditions, and regulatory compliance[35](index=35&type=chunk) - The company undertakes no obligation to publicly update or revise any forward-looking statement to reflect events or circumstances occurring after the document's date, except as required by law[36](index=36&type=chunk) [Company Information](index=10&type=section&id=Company%20Information) This section provides an overview of Liquidity Services' business and details for its Q3 FY25 financial results conference call [About Liquidity Services](index=13&type=section&id=About%20Liquidity%20Services) Liquidity Services operates the world's largest B2B e-commerce marketplace for surplus assets, facilitating over **$10 billion** in transactions and supporting client sustainability - Liquidity Services operates the world's largest B2B e-commerce marketplace platform for surplus assets[37](index=37&type=chunk) - The platform has facilitated over **$10 billion** in completed transactions to more than **five million** qualified buyers and **15,000** corporate and government sellers worldwide[37](index=37&type=chunk) - The company supports clients' sustainability efforts by extending asset life, preventing waste and carbon emissions, and reducing landfill products[37](index=37&type=chunk) [Conference Call Details](index=10&type=section&id=Conference%20Call%20Details) A conference call to discuss Q3 FY25 financial results will be held on August 7, 2025, with webcast and archive options available - Conference call to discuss results will be held on August 7, 2025, at **10:30 a.m. Eastern Time**[28](index=28&type=chunk) - A live listen-only webcast will be available on the company's investor relations website, with an archive available until August 7, 2026[28](index=28&type=chunk) [Unaudited Condensed Consolidated Financial Statements](index=14&type=section&id=Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section presents the unaudited condensed consolidated balance sheets, statements of operations, and statements of cash flows for Liquidity Services [Condensed Consolidated Balance Sheets](index=14&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets increased to **$372.4 million**, driven by cash and investments, with total stockholders' equity rising to **$208.7 million** Condensed Consolidated Balance Sheet Highlights (Dollars in Thousands) | Metric | June 30, 2025 | September 30, 2024 | | :-------------------------- | :------------ | :----------------- | | Cash and cash equivalents | $155,605 | $153,226 | | Short-term investments | $11,353 | $2,310 | | Total current assets | $220,007 | $199,235 | | Total assets | $372,435 | $346,888 | | Total current liabilities | $153,895 | $155,153 | | Total liabilities | $163,785 | $164,328 | | Total stockholders' equity | $208,650 | $182,560 | [Condensed Consolidated Statements of Operations](index=15&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Total revenue increased by **28%** year-over-year for the three months ended June 30, 2025, driven by purchase revenues, leading to improved profitability Condensed Consolidated Statements of Operations Highlights (Three Months Ended June 30, Dollars in Thousands) | Metric | 2025 | 2024 | YoY Change | | :------------------------------------------ | :----- | :----- | :--------- | | Purchase revenues | $76,517 | $53,396 | +43.3% | | Consignment and other fee revenues | $43,358 | $40,217 | +7.8% | | **Total revenue** | **$119,875** | **$93,613** | **+28.0%** | | Cost of goods sold (excludes D&A) | $65,110 | $44,212 | +47.3% | | Total costs and expenses | $109,657 | $85,718 | +27.9% | | **Income from operations** | **$10,218** | **$7,895** | **+29.4%** | | Income before provision for income taxes | $11,295 | $8,702 | +29.8% | | Provision for income taxes | $3,885 | $2,702 | +43.8% | | **Net income** | **$7,410** | **$6,000** | **+23.5%** | | Basic income per common share | $0.24 (dollars) | $0.20 (dollars) | +20.0% | | Diluted income per common share | $0.23 (dollars) | $0.19 (dollars) | +21.1% | [Condensed Consolidated Statements of Cash Flows](index=16&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the nine months ended June 30, 2025, net cash from operations decreased, while investing activities increased, and financing activities decreased Condensed Consolidated Statements of Cash Flows Highlights (Nine Months Ended June 30, Dollars in Thousands) | Metric | 2025 | 2024 | Change | | :------------------------------------------ | :----- | :----- | :----- | | Net income | $20,271 | $13,616 | +48.9% | | Net cash provided by operating activities | $28,768 | $48,215 | -40.3% | | Net cash used in investing activities | $(20,881) | $(17,646) | +18.3% | | Net cash used in financing activities | $(5,068) | $(10,825) | -53.1% | | Net decrease in cash and cash equivalents | $2,379 | $20,031 | -88.1% | | Cash and cash equivalents at end of period | $155,605 | $130,312 | +19.4% | | Cash paid for income taxes, net | $6,960 | $810 | +759.3% | - The decrease in net cash provided by operating activities was influenced by changes in accounts receivable, inventory, and payables to sellers[44](index=44&type=chunk) - Investing activities included **$6.5 million** for business acquisitions and **$16.2 million** for purchases of short-term investments in 2025[44](index=44&type=chunk)