Global-E Online (NasdaqGS:GLBE) Q3 2025 Earnings Call November 19, 2025 08:00 AM ET Company ParticipantsWill Nance - VPNone - Company RepresentativeAmir Schlachet - Co-founder and CEOAlan Katz - Head of Investor RelationsNone - Company RepresentativeOfer Koren - CFOBrian Peterson - Managing Director for Application SoftwareKoji Ikeda - Director of Enterprise Software Equity ResearchChris Zhang - ED of Equity ResearchNir Debbi - Co-founder and PresidentConference Call ParticipantsRob Wildhack - Director and ...

Financial Data and Key Metrics Changes - For Q3 2025, the company reported GMV of $1.51 billion, up 33% year-over-year, and revenue of $221 million, up 25.5% year-over-year [9][25] - Adjusted gross profit for Q3 was $102 million, up 24% from last year, with quarterly adjusted EBITDA at $41.3 million, up 33% compared to the same quarter of last year, resulting in an 18.7% margin [9][30] - GAAP net profit for the quarter was $13.2 million, with free cash flow of $73.6 million, an increase of almost 250% compared to last year [9][31] Business Line Data and Key Metrics Changes - Service fee revenue for Q3 was $103.5 million, while fulfillment services revenue was $117.3 million [26] - Non-GAAP gross profit was $102.1 million, representing a gross margin of 46.3% compared to 46.7% in the same period last year [26][30] - The company continues to invest in R&D and sales and marketing, with R&D expenses at $26.1 million or 11.8% of revenue, and sales and marketing expenses at $26.4 million or 12% of revenue [27][29] Market Data and Key Metrics Changes - The company has seen strong market traction with its largest merchants across different destination markets, indicating resilience in trading volumes despite tariff changes [17][25] - New merchant launches included brands like Everlane and Ashford in the U.S., and Chloé in France, showcasing expansion across various geographies [18][19] Company Strategy and Development Direction - The company is raising its full-year 2025 guidance for GMV to approximately $6.46 billion, representing over a 33% annual growth rate, and revenue to $952.1 million, representing 26.5% growth [8][32] - A $200 million share repurchase program was authorized by the board, reflecting the company's strong cash generation and balance sheet [12][31] - The company is strategically focusing on AI and agentic e-commerce, aiming to capitalize on emerging market opportunities [14][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the current trading patterns and the strong performance expected to continue into Q4 and beyond, with a robust pipeline of new merchant launches [17][23] - The company anticipates 2025 to be its first GAAP profitable year as a public company, reinforcing its path to meet medium-term targets [33][34] Other Important Information - The company is experiencing increased interest in its duty drawback offering due to rising global duty burdens, which is expected to be a critical component for merchants [10][39] - The BorderFree.com offering is seeing growth in shopper signups and sales conversion rates, indicating its value as a demand generation channel [11][66] Q&A Session Summary Question: Commentary on the duty drawback product and value-added services - Management highlighted the increasing importance of duty drawback services as global duty burdens rise, with potential for reclaiming duties on returned goods [39] Question: Pipeline and merchant growth heading into next year - Management remains optimistic about high demand for new services and the growth of the pipeline, driven by complexities in global e-commerce [41][42] Question: Service fee take rates and competitive dynamics - Management noted that service fee take rates have been slightly volatile due to a mix shift towards larger enterprise merchants, but no significant changes are expected [45][46] Question: Impact of tariffs on same-store sales and new merchant pipeline - Management acknowledged some weakness in specific corridors but remains optimistic about overall trading resilience and pipeline growth [53][62] Question: Contribution of ReturnGo acquisition to revenue - The ReturnGo acquisition is expected to contribute up to $1 million in revenue for Q4, with optimistic long-term potential [56][57] Question: Duty drawback explanation and rollout in new countries - Management provided a simplified explanation of how duty drawback works and the necessary steps for rollout in new jurisdictions [72][74] Question: Agentic Commerce and data flow integration - Management discussed the potential of Agentic Commerce to affect the entire e-commerce value chain and the company's positioning to enable AI-powered transactions [78][81]