Freightos(CRGO) - 2025 Q2 - Quarterly Report

Company Overview and Q2 2025 Highlights Freightos achieved strong Q2 2025 financial and operational growth, with 31% revenue increase and improved key metrics Introduction and Management Commentary Freightos reported robust Q2 2025 results with 31% revenue growth, revised outlook, and targets breakeven Adjusted EBITDA - CEO Zvi Schreiber noted "robust second-quarter results with a 31% year-over-year revenue increase" and an upward revision of the full-year Transaction outlook, reflecting confidence in sustained growth[2] - CFO Pablo Pinillos stated that Q2 performance surpassed expectations with strong revenue growth, and Adjusted EBITDA was in line with expectations, despite currency fluctuations[2] - Freightos remains committed to achieving breakeven Adjusted EBITDA by the end of 2026[2] Second Quarter 2025 Financial Highlights Freightos achieved $7.4 million revenue in Q2 2025 (+31% YoY), with improved IFRS loss and Adjusted EBITDA Q2 2025 Financial Highlights | Metric | Q2 2025 ($ million) | Q2 2024 ($ million) | YoY Change | | :-------------- | :---------- | :---------- | :--------- | | Revenue | $7.4 million | $5.7 million | +31% | | IFRS Loss | $(4.3) million | $(5.3) million | Improved | | Adjusted EBITDA | $(2.9) million | $(3.1) million | Improved | Recent Business Highlights Key operational metrics grew significantly, with 397k transactions (+26% YoY), GBV up 56%, and 75 carriers on platform Q2 2025 Key Business Metrics Growth | Metric | Q2 2025 | Q2 2024 | YoY Change | | :---------------------- | :-------- | :-------- | :--------- | | IFRS Gross Margin | 67.1% | 64.9% | +2.2 percentage points | | Non-IFRS Gross Margin | 73.5% | 72.0% | +1.5 percentage points | | Cash & Cash Equivalents ($ million) | $34.1 million | N/A | N/A | | Transactions (thousands) | 397k | N/A | +26% | | Unique Buyer Users (approx) | ~20,200 | N/A | +6% | | Gross Booking Value (GBV) ($ million) | $317 million | N/A | +56% | | Total Platform Revenue ($ million) | $2.5 million | N/A | +23% | | Solutions Revenue ($ million) | $4.9 million | N/A | +36% | - The number of carriers selling on the platform increased from 71 in Q1 2025 to 75 in Q2 2025, with additions including China Airlines and Air Europa[4] - Revenue growth was primarily contributed by the addition of Shipsta and strong organic performance from SaaS solutions and customs clearance services[4] Financial Outlook Freightos provided updated Q3 and full-year 2025 guidance, projecting continued growth in key metrics and improved Adjusted EBITDA Q3 2025 and Full-Year 2025 Guidance Freightos provided updated Q3 and FY2025 guidance, projecting continued growth in key metrics and improved Adjusted EBITDA Management Expectations for Q3 2025 and FY 2025 | Metric | Q3 2025 Range | YoY Growth (Q3) | FY 2025 Range | YoY Growth (FY) | | :---------------- | :------------ | :-------------- | :-------------- | :-------------- | | Transactions (thousands) | 419 - 425 | 24% - 25% | 1,607 - 1,684 | 23% - 29% | | GBV ($ million) | 329 - 333 | 51% - 53% | 1,251 - 1,266 | 40% - 42% | | Revenue ($ million) | 7.6 - 7.7 | 23% - 25% | 29.5 - 30.0 | 24% - 26% | | Adjusted EBITDA ($ million) | (2.6) - (2.5) | N/A | (10.9) - (10.5) | N/A | About Freightos Freightos is a leading global freight booking platform, digitizing the industry, with a glossary of key operational and financial terms Company Description Freightos is a leading vendor-neutral global freight booking platform, digitizing the international freight industry - Freightos (Nasdaq: CRGO) is the leading vendor-neutral global freight booking platform, connecting airlines, ocean carriers, thousands of freight forwarders, and over ten thousand importers and exporters to make world trade efficient[14] - The platform offers a suite of software solutions for pricing, quoting, booking, shipment management, and payments, including Freightos Enterprise, Freightos Marketplace, WebCargo, 7LFreight, WebCargo for Airlines, and Clearit (a digital customs broker)[15] - Freightos provides real-time industry data via Freightos Terminal, which includes the Freightos Air Index (FAX) and Freightos Baltic Index (FBX), with FBX futures traded on CME and SGX[16] Glossary of Key Terms This section defines key operational and financial terms used in the report for clarity and consistent understanding - Transactions: Number of bookings for freight services and related services placed by Buyers across the Freightos platform[13] - Carriers: Number of unique air and ocean carriers that have been sellers of transactions, counted when more than five bookings were placed with them over a quarter[13] - Unique buyer users: Number of individual users placing bookings, typically based on unique email logins, monitored as a more useful metric than buyer businesses[13] - GBV (Gross Booking Value): Total monetary value of freight and related services contracted on the Freightos platform, plus related fees and pass-through payments, reflecting the platform's scale[13] - Adjusted EBITDA: Loss before income taxes, finance income/expense, share-based compensation, depreciation/amortization, operating expense settled by shares, and change in fair value of warrants[17] - Platform revenue: Fees charged to buyers and sellers for transactions executed on the Freightos platform, typically structured as a percentage of booking value or a flat fee[17] - Solutions revenue: Primarily subscription-based SaaS and data, priced per user or per site, with additional non-recurring revenue from ancillary services[17] Consolidated Financial Statements This section presents Freightos' consolidated balance sheets, statements of operations, and cash flows for Q2 2025 and prior periods Consolidated Balance Sheets Freightos reported total assets of $71.6 million as of June 30, 2025, with decreased current assets and increased cash Consolidated Balance Sheet Highlights (in thousands) | Metric | June 30, 2025 | December 31, 2024 | Change | | :------------------------ | :------------ | :---------------- | :--------- | | Total Assets | $71,635 | $73,779 | $(2,144) | | Cash and cash equivalents | $19,981 | $10,118 | +$9,863 | | Short-term bank deposit | $14,168 | $27,153 | $(12,985) | | Total Liabilities | $22,870 | $18,891 | +$3,979 | | Total Equity | $48,765 | $54,888 | $(6,123) | Consolidated Statements of Operations Q2 2025 revenue reached $7.4 million (+31% YoY), with increased gross profit and reduced IFRS loss Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | YoY Change | H1 2025 | H1 2024 | YoY Change (H1) | | :------------------------------- | :--------- | :--------- | :--------- | :--------- | :--------- | :-------------- | | Revenue | $7,438 | $5,658 | +31.4% | $14,383 | $11,013 | +30.6% | | Cost of revenue | $2,445 | $1,984 | +23.2% | $4,751 | $3,989 | +19.1% | | Gross profit | $4,993 | $3,674 | +35.9% | $9,632 | $7,024 | +37.1% | | Total operating expenses | $9,507 | $8,238 | +15.4% | $18,827 | $17,072 | +10.3% | | Operating loss | $(4,514) | $(4,564) | Improved | $(9,195) | $(10,048) | Improved | | Loss before taxes on income | $(4,240) | $(5,321) | Improved | $(8,684) | $(9,950) | Improved | | Loss | $(4,278) | $(5,314) | Improved | $(8,777) | $(9,930) | Improved | | Basic and diluted loss per share | $(0.09) | $(0.11) | Improved | $(0.18) | $(0.21) | Improved | Consolidated Statements of Cash Flows Net cash used in operating activities was $(2.8) million in Q2 2025, with significant investing activity changes Consolidated Statements of Cash Flows Highlights (in thousands) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :---------------------------------------- | :--------- | :--------- | :--------- | :--------- | | Net cash used in operating activities | $(2,822) | $(2,764) | $(2,532) | $(4,505) | | Net cash provided by (used in) investing activities | $(13,947) | $11,506 | $11,944 | $5,508 | | Net cash provided by (used in) financing activities | $76 | $20 | $189 | $(108) | | Cash and cash equivalents at period end | $19,981 | $21,001 | $19,981 | $21,001 | - A significant factor in investing activities was a $(14,000) thousand withdrawal of short-term bank deposit in Q2 2025, compared to no such withdrawal in Q2 2024[21] Non-IFRS Financial Measures Reconciliations This section reconciles IFRS financial measures to non-IFRS measures, including gross profit, gross margin, Adjusted EBITDA, and loss per share Reconciliation of IFRS to Non-IFRS Gross Profit and Gross Margin Non-IFRS gross profit for Q2 2025 was $5.5 million (73.5% margin), up from Q2 2024 Gross Profit and Gross Margin Reconciliation (in thousands, except gross margin data) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :------------------------ | :--------- | :--------- | :--------- | :--------- | | IFRS gross profit | $4,993 | $3,674 | $9,632 | $7,024 | | Add: Share-based comp. | $82 | $89 | $180 | $190 | | Add: Dep. & amort. | $392 | $312 | $775 | $623 | | Non-IFRS gross profit | $5,467 | $4,075 | $10,587 | $7,837 | | IFRS gross margin | 67.1% | 64.9% | 67.0% | 63.8% | | Non-IFRS gross margin | 73.5% | 72.0% | 73.6% | 71.2% | Reconciliation of IFRS Loss to Adjusted EBITDA Adjusted EBITDA for Q2 2025 improved to negative $2.9 million from negative $3.1 million in Q2 2024 Adjusted EBITDA Reconciliation (in thousands, except adjusted EBITDA margin data) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :---------------------------------------- | :--------- | :--------- | :--------- | :--------- | | IFRS loss | $(4,278) | $(5,314) | $(8,777) | $(9,930) | | Add: Change in fair value of warrants | $285 | $1,324 | $508 | $1,040 | | Add: Financing income, net | $(559) | $(567) | $(1,019) | $(1,138) | | Add: Tax benefit (income taxes), net | $38 | $(7) | $93 | $(20) | | Add: Share-based compensation | $811 | $751 | $1,508 | $1,594 | | Add: Depreciation and amortization | $806 | $706 | $1,744 | $1,410 | | Add: Operating expense settled by shares | $0 | $0 | $0 | $351 | | Adjusted EBITDA | $(2,897) | $(3,107) | $(5,943) | $(6,693) | | Adjusted EBITDA margins | -39% | -55% | -41% | -61% | Reconciliation of IFRS Loss to Non-IFRS Loss and Loss Per Share Non-IFRS loss for Q2 2025 was $(2.4) million, with stable non-IFRS basic and diluted loss per share Non-IFRS Loss and Loss Per Share Reconciliation (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :------------------------------------------------ | :--------- | :--------- | :--------- | :--------- | | IFRS loss | $(4,278) | $(5,314) | $(8,777) | $(9,930) | | Add: Share-based compensation | $811 | $751 | $1,508 | $1,594 | | Add: Depreciation and amortization | $806 | $706 | $1,744 | $1,410 | | Add: Operating expense settled by issuance of shares | $0 | $0 | $0 | $351 | | Add: Changes in fair value of contingent consideration | $0 | $(6) | $0 | $(6) | | Add: Change in fair value of warrants | $285 | $1,324 | $508 | $1,040 | | Non IFRS loss | $(2,376) | $(2,539) | $(5,017) | $(5,541) | | Non IFRS basic and diluted loss per Ordinary share | $(0.05) | $(0.05) | $(0.10) | $(0.12) | Additional Information This section provides details on the earnings webcast, forward-looking statements disclaimer, and explanation of non-IFRS financial measures Earnings Webcast Details Freightos management hosted a webcast on August 18, 2025, to discuss Q2 results, with replay available online - A webcast and conference call was hosted on August 18, 2025, at 8:30 a.m. EST, featuring Freightos' management and new Chairman Dr. Udo Lange[6] - A replay of the webcast and the conference call transcript will be made available on Freightos' Investor Relations website[7] Forward-Looking Statements Disclaimer This section disclaims forward-looking statements, noting they are subject to risks and uncertainties, and not predictions - The press release includes "forward-looking statements" identified by words such as "estimate," "plan," "project," and "expect," which are based on current expectations and assumptions, not predictions of actual performance[8] - These statements are subject to numerous risks and uncertainties, including disruptions to the international freight industry, competition, technological changes (particularly in artificial intelligence), and the ability to retain management and protect intellectual property[8] - Freightos disclaims any obligation to update these forward-looking statements, and they should not be relied upon as representing assessments as of any date subsequent to the press release date[9] Non-IFRS Financial Measures Explanation This section clarifies non-IFRS measures provide supplemental insights into operating performance and comparability - The press release includes certain financial measures not presented in accordance with IFRS, such as Adjusted EBITDA[11] - These non-IFRS measures provide useful information for investors and others to understand and evaluate Freightos' operating results, offering supplemental measures of core operating performance and consistency for internal planning and comparison with peer companies[11] - While historical non-IFRS results are reconciled to IFRS, forward-looking non-IFRS data does not include such a reconciliation due to unreasonable effort[11]