Red Violet(US:RDVT)2022-11-07 21:56Financial Performance - Total revenue increased by 29% to $15.0 million, with platform revenue rising by 31% to $14.8 million, while services revenue decreased by 29% to $0.2 million[75]. - Gross profit increased by 36% to $10.3 million, resulting in a gross margin increase to 69% from 65%[75]. - Adjusted EBITDA rose by 43% to $5.2 million, with an adjusted EBITDA margin of 35% compared to 31% in the previous year[75]. - Net income increased by 80% to $2.3 million, translating to $0.16 per basic and diluted share[75]. - Revenue increased by $3.3 million or 29% to $15.0 million for the three months ended September 30, 2022, compared to $11.7 million for the same period in 2021[79]. - Net income increased by $1.0 million or 80% to $2.3 million for the three months ended September 30, 2022, compared to $1.3 million for the same period in 2021[86]. - For the nine months ended September 30, 2022, revenue increased by $7.4 million or 23% to $40.2 million compared to $32.8 million for the same period in 2021[87]. - The company reported net income of $2.3 million for the three months ended September 30, 2022, compared to $1.3 million for the same period in 2021, showing a year-over-year increase of 76.9%[101]. Customer Growth - The company added 56 customers to IDI during the third quarter, bringing the total to 6,873 customers[75]. - Revenue from new customers increased by $1.1 million or 130%, while base revenue from existing customers rose by $1.6 million or 18% for the three months ended September 30, 2022[79]. - The IDI billable customer base grew from 6,314 customers as of September 30, 2021, to 6,873 customers as of September 30, 2022[79]. - FOREWARN saw an addition of 8,790 users in the third quarter, ending with 110,051 users, with over 225 REALTOR® Associations contracted to use the service[75]. Cash and Liquidity - Cash and cash equivalents stood at $31.3 million as of September 30, 2022[75]. - Cash and cash equivalents as of September 30, 2022, were approximately $31.3 million, indicating sufficient resources to finance operations for the next twelve months[102]. - The company anticipates funding operations using available cash and cash flow generated from operations within the next twelve months[100]. Expenses and Costs - Cost of revenue increased by $0.3 million or 10% to $3.1 million for the three months ended September 30, 2022, while the cost of revenue as a percentage of revenue decreased to 20% from 24%[80][81]. - Sales and marketing expenses rose by $0.4 million or 22% to $2.6 million for the three months ended September 30, 2022, primarily due to increased salaries and benefits[82]. - General and administrative expenses increased by $1.4 million or 32% to $5.5 million for the three months ended September 30, 2022, driven by higher employee salaries and professional fees[83]. Shareholder Equity and Capital - As of September 30, 2022, total shareholders' equity was $72.2 million[101]. - The company has repurchased a total of 50,000 shares of its common stock at an average price of $17.52 per share under its Stock Repurchase Program[75]. - Material commitments under data licensing agreements amounted to $28.7 million as of September 30, 2022[100]. - The company may need to raise capital through additional equity and/or debt, which could dilute stockholders if terms are unfavorable[103]. - As of September 30, 2022, there were no off-balance sheet arrangements[104]. Operational Insights - The company continues to enhance its go-to-market capabilities with the expansion of its sales team, focusing on strategic areas within fraud and identity[75]. - The idiVERIFIED service is expected to return to pre-Covid levels in the first half of 2023[67]. - For the nine months ended September 30, 2022, net cash provided by operating activities was $8.1 million, compared to $7.0 million for the same period in 2021, reflecting an increase of approximately 15.7%[97]. - Net cash used in investing activities for the nine months ended September 30, 2022, was $6.4 million, up from $3.8 million in 2021, indicating a 68.4% increase[98]. - Net cash used in financing activities was $4.7 million for the nine months ended September 30, 2022, compared to $2.8 million in 2021, representing a 67.9% increase[99].