Financial Data and Key Metrics Changes - Q3 2025 total revenue grew 34% year-on-year to $124.5 million, with subscription revenue increasing 34% to $96.3 million [26][27] - Core Life360 subscription revenue rose 37%, driven by global paying circle growth and improved conversion rates [26][27] - Other revenue grew 82% year-on-year to $16.9 million, primarily from advertising performance [26][27] - Annualized monthly revenue reached $446.7 million, up 33% year-on-year, with gross profit increasing 39% to $97.1 million [28][29] Business Line Data and Key Metrics Changes - Total paying circles grew 23% year-over-year to 2.7 million, with 170,000 net new additions in Q3 [11] - Monthly active users (MAUs) increased by 3.7 million, growing 19% year-over-year, totaling nearly 92 million [10][11] - Standalone hardware revenue decreased 4% year-on-year to $11.3 million, despite a 15% increase in unit sales [27] Market Data and Key Metrics Changes - Paying circles outside the U.S. grew 29% year-over-year, with an 8% year-over-year increase in average revenue per paying circle (ARPPC) [12] - The company noted strong international momentum, particularly in the U.K., Canada, Australia, and New Zealand [12] Company Strategy and Development Direction - The company aims to expand its product offerings, including the recently launched Life360 Pet GPS, which integrates pet safety into its platform [14][17] - The acquisition of Nativo is expected to enhance the advertising business and create a unified ad platform, positioning Life360 for long-term growth [18][32] - The focus remains on building high-margin complementary revenue streams while enhancing the core subscription model [24][32] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the trajectory for Q4 and 2026, raising full-year revenue guidance due to strong performance and new product launches [35][36] - The company is committed to increasing value for members and expanding its reach through innovative marketing and product development [13][24] Other Important Information - The company reported a net income of $9.8 million for Q3, up from $7 million in Q2 and $7.7 million in Q3 last year [30] - Adjusted EBITDA rose 174% year-on-year to $24.5 million, representing a 20% margin [31] Q&A Session Summary Question: Can you discuss the Nativo acquisition and its impact on the advertiser base? - Management views the Nativo acquisition as additive and expects it to accelerate growth with enhanced technology and features [38] Question: What is the revenue run rate of Nativo and its cost base for FY25? - Nativo's revenue run rate is approximately twice that of Life360, and it is expected to be adjusted EBITDA positive next year [42] Question: What factors will influence the rate of margin expansion? - Key factors include scale and the increasing mix of higher-margin revenue, particularly from advertising [46][47] Question: What are the top priorities for product development moving forward? - The focus is on enhancing the core app experience and making it more user-friendly for aging parents [48][49] Question: How is the Pet GPS performing in terms of adoption? - The Pet GPS launch exceeded expectations, with strong initial demand primarily from existing members [54][55] Question: What is the differentiation of Nativo's advertising platform? - Nativo's platform focuses on relevant ads for consumers, leveraging both direct and programmatic deals to enhance Life360's advertising capabilities [82]

Financial Data and Key Metrics Changes - Revenue increased by 40% year-over-year to $146.8 million compared to $105.2 million in the prior-year period [14] - Net income surged to $23.9 million, a significant increase from $1.6 million in the prior-year period [15] - Adjusted EBITDA rose 1.6 times to $24.9 million from $9.6 million in the prior-year period [15] - Operating cash flow improved to $23.2 million from cash used of $12.9 million in the prior-year period [15] Business Line Data and Key Metrics Changes - Electric sales increased by 29% to $93.2 million compared to $72.1 million in the prior-year period, driven by favorable weather and higher energy demand [14] - Coal sales rose by 42% to $68.8 million from $48.3 million in the prior-year period, supported by increased shipments and favorable power markets [14] Market Data and Key Metrics Changes - The Hallador Power subsidiary experienced a more than 29% year-over-year revenue increase due to favorable summer weather and elevated natural gas prices [5] - The company expects to produce approximately 3.8 million tons of coal in 2025, having produced 3.1 million tons through the first nine months [11] Company Strategy and Development Direction - The company submitted an application to the MISO ERIS program to add 525 MW of gas generation at the Merom site, marking a strategic step to grow its generation portfolio [5] - Hallador is transitioning from a commodity-focused coal producer to a vertically integrated independent power producer, leveraging the energy transition to capture expanding margins in power markets [11] - The company is evaluating strategic opportunities to acquire additional dispatchable generation assets to diversify its portfolio and enhance growth [9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong market signals for their product offerings and the potential for long-term agreements with data center developers and load-serving entities [7] - The evolving energy landscape, characterized by the retirement of dispatchable generators in favor of renewables, is creating opportunities for reliable baseload generation [8] - Management does not expect Q4 performance to match the exceptional results of Q3, anticipating a return to more typical conditions unless extreme weather occurs [22] Other Important Information - The company executed a $20 million prepaid forward power sales contract, which is a key component of its commercial strategy [6] - Total forward energy and capacity sales position was $571.7 million as of September 30, 2025, down from $685.7 million at the end of 2024 [16] Q&A Session Summary Question: What are the main milestones for the potential capacity expansion? - Management indicated that the MISO expedited process will determine the timeline for reviewing their application, with updates expected in the coming months [20][21] Question: How has Q4 started compared to Q3? - Management noted that Q4 is expected to resemble Q4 of 2024, with no significant catalysts anticipated to drive performance like Q3 [22] Question: Can you provide initial economics on the 525 MW expansion? - Management is still negotiating equipment and has not released detailed economics but is encouraged by market signals indicating a need for more capacity [27][28] Question: What impact might the recent government funding for coal have? - Management believes that government funding could be beneficial for the industry and that Hallador may have qualifying projects [30] Question: Are you seeing opportunities for M&A in the coal space? - Management expressed a preference for coal-related acquisitions, noting that such transactions are bespoke and take time to develop [37] Question: What is the status of discussions with potential customers? - Management confirmed ongoing negotiations with multiple parties, including utilities and data center developers, with increased interest noted [43][44]

Kaltura (NasdaqGS:KLTR) Q3 2025 Earnings Call November 10, 2025 05:00 PM ET Company ParticipantsRon Yekutiel - Chairman, President and CEOJohn Doherty - CFOErica Mannion - Head of Investor RelationsConference Call ParticipantsRyan Koontz - Managing Director and Research AnalystD.J. Hynes - Managing Director and Senior AnalystOperatorGood afternoon, everyone, and welcome to the Kaltura Third Quarter 2025 Earnings Call. All material contained in the webcast is the sole property and copyright of Kaltura, with ...

Financial Data and Key Metrics Changes - CoreWeave reported Q3 revenue of $1.4 billion, representing a 134% year-over-year increase [5][23] - Revenue backlog reached over $55 billion at the end of Q3, nearly doubling from Q2 [5][23] - Adjusted operating income for Q3 was $217 million, with an adjusted operating margin of 16% [24] - Net loss for Q3 was $110 million, a significant improvement from a $360 million loss in Q3 of 2024 [25] - Adjusted EBITDA for Q3 was $838 million, more than doubling from $379 million in Q3 of 2024, with an adjusted EBITDA margin of 61% [25] Business Line Data and Key Metrics Changes - CoreWeave expanded its active power footprint by 120 MW sequentially to approximately 590 MW [6][7] - Contracted power capacity grew over 600 MW to 2.9 GW, with more than 1 GW of contracted capacity expected to be sold to customers in the next 12 to 24 months [7][12] - The number of customers exceeding $100 million in revenue over the last 12 months tripled year-over-year, indicating a diversification of the revenue base [8] Market Data and Key Metrics Changes - More than 60% of CoreWeave's revenue backlog is tied to investment-grade customers, down from approximately 85% at the beginning of the year [23][81] - No single customer represents more than approximately 35% of the revenue backlog, a decrease from about 50% last quarter [23][81] Company Strategy and Development Direction - CoreWeave aims to scale aggressively in a supply-constrained environment, focusing on AI cloud services [5][20] - The company is diversifying its customer base and expanding its product offerings, including new acquisitions to enhance its capabilities [17][20] - CoreWeave is also entering the public sector with the launch of CoreWeave Federal to serve U.S. government agencies [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth trajectory, despite current supply chain challenges [22][32] - The company anticipates continued robust demand for its services, with expectations for 2025 revenue in the range of $5.05-$5.15 billion [30] - Management noted that delays from a third-party data center provider would impact Q4 results but are expected to be resolved by Q1 of the following year [30][54] Other Important Information - CoreWeave's capital expenditures in Q3 totaled $1.9 billion, lower than anticipated due to delays [25][26] - The company has secured $14 billion in debt and equity transactions year-to-date to support its growth [29] - CoreWeave's new storage product, AI Object Storage, has already surpassed $100 million in annual recurring revenue (ARR) in Q3 [16] Q&A Session Summary Question: Can you speak to the situation relating to the third-party provider? - Management acknowledged systemic challenges in supply chains affecting infrastructure delivery but emphasized efforts to diversify data center providers and manage delays [36][37] Question: How should we think about your infrastructure and its fungibility? - Management confirmed that the infrastructure is designed to be fungible, allowing for flexibility in usage across different customers and applications [41][42] Question: How far are we from reaching a point where disruptions should not affect revenue outlook? - Management indicated that as the company scales, the impact of individual delays will become less significant, with expectations for smoother operations as capacity increases [47][48] Question: What is the uniqueness of CoreWeave's value proposition in the future? - Management highlighted the company's focus on delivering customized infrastructure and software solutions that differentiate it from competitors [49][50] Question: Can you clarify the impact of CapEx reductions? - Management confirmed that the CapEx reduction is primarily due to delays from a single data center provider, with most of the impact expected to be resolved in Q1 [64][65] Question: How do you think about funding paths for CapEx? - Management stated that they will explore various financing options, including leasing, to ensure cost-effective scaling and service delivery [68][69]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $85.6 million, representing a 7% year-over-year increase and a 10% quarter-over-quarter increase, exceeding the midpoint of guidance [32] - Contribution XTAC totaled $53 million, up 12% year-over-year and 10% sequentially, reaching the high end of guidance [32] - Adjusted EBITDA for Q3 was $16 million, growing 9% year-over-year and 42% sequentially, with an adjusted EBITDA margin of 30% [38] Business Line Data and Key Metrics Changes - Excluding political ad spend from the prior year, Q3 revenue increased 19% year-over-year, and contribution XTAC increased 22% year-over-year on a pro forma basis [33] - CTV accounted for a record high of 46% of total platform spend, with nearly half running through Direct Access premium publishers [36] - Revenue attached to the Iris ID more than doubled sequentially versus the prior quarter, indicating strong demand for contextually targeted campaigns [15] Market Data and Key Metrics Changes - Spend across emerging digital channels, including CTV, streaming audio, and digital out of home, represented approximately 56% of total platform spend in Q3, up from 50% in 2024 and 43% in 2023 [36] - The majority of leading streaming services have joined the Direct Access program, enhancing the platform's capabilities [12] Company Strategy and Development Direction - The company aims to maintain its dominant position in the mid-market while expanding up-market with major U.S. advertisers and down-market to performance advertisers [23] - The launch of AI Decisioning is expected to enhance the self-service capabilities of the platform, making it more accessible for SMBs and direct-to-consumer e-commerce companies [29] - The partnership with Molson Coors highlights the company's ability to attract major U.S. brands seeking data-driven campaigns [25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the underlying performance of the business, with expectations for accelerating growth in 2026 driven by new client onboarding [44] - The company anticipates significant EBITDA margin expansion in 2026, supported by improved operational efficiencies and the integration of recent acquisitions [44] Other Important Information - The company ended Q3 with $161 million in cash and cash equivalents, no debt, and full access to a $75 million credit facility [39] - The share repurchase program has returned $59.6 million to shareholders since its launch, signaling confidence in long-term value [40] Q&A Session Summary Question: What is the difference with the third AI product launching in Q4? - Management indicated that AI Decisioning will complete the Viant AI suite, enabling full self-driving capabilities for ad campaigns, reducing the need for human intervention [51][52] Question: Is the 600 basis point headwind from a merger client a one-time issue? - Management clarified that the headwind is primarily from a seasonal client and will not significantly impact other quarters [48] Question: How does the company plan to grow awareness among SMB advertisers? - The strategy includes channel partnerships and a self-service sign-up flow to attract direct-to-consumer e-commerce companies [58][60] Question: What is the expected incremental spend from the Molson Coors partnership? - While specific figures cannot be disclosed, management expects the partnership to scale over time, contributing to the $250 million incremental spend pipeline [62] Question: How does the competitive environment look with companies like Amazon and Google? - Management noted that competition remains consistent, with Viant's objective buy-side approach differentiating it from competitors who have conflicts of interest [64][66]

Financial Data and Key Metrics Changes - Q3 2025 total revenue grew 34% year-on-year to $124.5 million, with subscription revenue increasing 34% to $96.3 million [26][31] - Core Life360 subscription revenue, excluding standalone hardware subscriptions, rose 37% [26] - Other revenue grew 82% year-on-year to $16.9 million, driven by strong performance in advertising [26][31] - Annualized monthly revenue reached $446.7 million, up 33% year-on-year [28] - Gross profit increased 39% year-on-year to $97.1 million, with gross margin at 78% compared to 75% a year ago [29] Business Line Data and Key Metrics Changes - Total paying circles grew 23% year-on-year to 2.7 million, with 170,000 net new additions [11] - Monthly active users (MAUs) increased by 3.7 million, growing 19% year-on-year, totaling nearly 92 million [10][11] - Standalone hardware revenue decreased 4% year-on-year to $11.3 million, despite a 15% increase in unit sales [27] Market Data and Key Metrics Changes - Paying circles outside the U.S. grew 29% year-on-year, with an 8% year-over-year increase in average revenue per paying circle (ARPPC) [12] - The company noted strong international momentum, particularly in the U.K., Canada, Australia, and New Zealand [12] Company Strategy and Development Direction - The company aims to expand its product offerings beyond family safety to include pet safety with the launch of Life360 Pet GPS [14][17] - The acquisition of Nativo is expected to accelerate the advertising business and enhance revenue streams [18][32] - The focus remains on organic growth driven by product innovation and brand awareness [8][13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the trajectory for the remainder of 2025, raising full-year revenue guidance [35][36] - The company is committed to increasing the value delivered to members and expanding its reach through connected devices [13][14] - Management highlighted the importance of maintaining a strong core app experience while exploring new product opportunities [49] Other Important Information - The company reported a net income of $9.8 million for the quarter, up from $7 million in Q2 and $7.7 million in Q3 last year [30] - Adjusted EBITDA rose 174% year-on-year to $24.5 million, representing a 20% margin [31] Q&A Session Summary Question: Can you discuss the Nativo acquisition and its impact on the existing advertiser base? - Management views the Nativo acquisition as additive and expects it to accelerate growth with the technology and momentum it brings [38] Question: What is the revenue run rate of Nativo and its cost base for FY 2025? - Nativo's revenue run rate is roughly twice that of Life360, and it is expected to be adjusted EBITDA positive next year [42] Question: What factors will influence the rate of margin expansion? - Key factors include scale and the increasing mix of higher-margin revenue, particularly from advertising [46][47] Question: What are the top priorities for product development moving forward? - The focus is on enhancing the core app experience and making it more appealing to aging parents, with plans to introduce features in 2026 [49][85] Question: How is the Pet GPS launch performing in terms of adoption? - The launch has exceeded expectations, with strong initial demand primarily from existing members [54]

Financial Data and Key Metrics Changes - For Q3 2025, the company reported transaction volumes of $235 million, an increase of 43% year-over-year, and net revenues of $7.4 million, up 41% year-over-year [7][18] - Year-to-date revenues through September 30 were $22.7 million, reflecting a 48% increase over the same period in 2024, with total transaction volumes of $753 million, representing a 74% increase [18][19] - The company recorded a GAAP net income of $0.6 million in Q3 2025, compared to a net loss of $62.3 million in Q3 2024, primarily driven by a $10.2 million increase in the fair value of its Bitcoin investment treasury [19][20] Business Line Data and Key Metrics Changes - The company is experiencing organic growth, with significant contributions from new customers and deeper penetration into the existing customer base, particularly through its Bitcoin gift card and credit card offerings [18][21] - The upcoming Bitcoin Rewards credit card is expected to enhance customer acquisition and increase transaction volumes, with a waitlist exceeding 80,000 users [9][40] Market Data and Key Metrics Changes - The company is well-positioned to capture the growing demand for Bitcoin financial services, particularly among millennials who are expected to control nearly $80 trillion in wealth in the coming years [7][8] - The company has established partnerships with Visa and Stripe for its credit card, enhancing its credibility and distribution capabilities in the market [8][9] Company Strategy and Development Direction - The company aims to create a comprehensive ecosystem that integrates earning, saving, and spending in Bitcoin, with a focus on innovative financial products [14][15] - The strategy includes monitoring regulatory changes and exploring opportunities in loan products, retirement plans, and insurance offerings [14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, citing the growing adoption of Bitcoin and the company's unique position to meet this demand [6][8] - The company anticipates continued revenue growth driven by new product lines and increased marketing investments, particularly in Q4, which is historically the highest volume quarter [24][65] Other Important Information - The company currently holds 1,526 Bitcoin valued at approximately $154 million, representing a 53% increase in holdings since going public [14][22] - The company has a healthy balance sheet with cash and cash equivalents of $6.7 million and no unsecured debt [22] Q&A Session Summary Question: Can you share early data and interest regarding the Bitcoin gift card? - Management noted high excitement and healthy volume from the gift card rollout, with significant customer engagement expected during the holiday season [29][30] Question: What does the expansion of gift card locations look like? - The company is exploring various retail and promotional opportunities, including partnerships with sports venues and loyalty programs [33][34] Question: How is the demand for the credit card trending? - The waitlist for the credit card has surpassed 80,000, indicating strong interest and growth potential in this new product category [39][40] Question: How will customer acquisition and marketing spend change? - The gift card is becoming a successful customer acquisition tool, with negative acquisition costs, allowing the company to generate revenue while acquiring new customers [43][44] Question: Can you elaborate on the capital raise and strategic opportunities? - The company is utilizing a revolving credit facility to access the value of its Bitcoin without selling it, aligning with its long-term growth strategy [53][54] Question: What is the strategy for converting active accounts into verified users? - The upcoming credit card is expected to be a key driver in converting existing users into deeper product lines, enhancing overall engagement [78][80]

Financial Data and Key Metrics Changes - Total revenue for Q3 2025 was $76.3 million, flat year-over-year, exceeding guidance [7][15] - Adjusted EBITDA for Q3 2025 was $12 million, up 64% compared to Q3 2024, exceeding guidance of approximately $10.5 million [17] - Adjusted gross margin increased to 53%, up approximately 510 basis points year-over-year [16] Business Line Data and Key Metrics Changes - Technology segment revenue was $52.1 million, representing a 7% year-over-year growth driven by recurring revenue from new and acquired clients [7][15] - Professional services revenue for Q3 2025 was $24.3 million, a 12% decline compared to Q3 2024, primarily due to exiting less profitable contracts [15][16] - Adjusted technology gross margin was 68%, an increase of approximately 330 basis points year-over-year [16] Market Data and Key Metrics Changes - The company anticipates approximately 30 net new platform client additions for 2025, with dollar-based retention expected to be in the low 90% [8][14] - The market remains dynamic, with ongoing financial and workforce pressures impacting client operations [10][14] Company Strategy and Development Direction - The company is focused on solutions with proven ROI, aiming to maintain a strong pipeline while managing costs and making targeted investments [8][14] - Recent leadership appointments aim to support long-term vision and improve performance, reflecting a commitment to building an agile organization [10] - The company plans to balance growth, revenue mix, and free cash flow progression while prioritizing existing capabilities and recently acquired assets [15][21] Management's Comments on Operating Environment and Future Outlook - Management expects revenue performance in 2026 to be a few points lower than in 2025, driven by dollar-based retention pressures and lower net new client counts [14] - The company is optimistic about improving adjusted EBITDA in 2026, reflecting ongoing strategic focus and cost management [14][21] - Management emphasizes the importance of meeting clients where they are, providing flexibility in migration timelines to enhance client experience and retention [12][28] Other Important Information - The company is committed to realizing a strong return on acquisition investments and does not anticipate pursuing additional acquisitions in the near to medium term [15] - The company is making progress on Ignite migration initiatives, with approximately two-thirds of DOS clients expected to migrate by the end of 2025 [11][12] Q&A Session Summary Question: What is driving the longer timeline for Ignite migration? - Management noted that clients desire to stay on DOS longer due to its current value, and flexibility is being provided to meet client needs [26][27] Question: How does the sequential decline in tech revenue relate to dollar-based retention? - Management explained that the decline is influenced by DOS to Ignite headwinds and growth in the apps layer, with a mix of factors affecting revenue [32][33] Question: What is the value of one-time revenues and the outlook for positive revenue growth? - Management indicated that one-time revenues are becoming more common in professional services, and the pipeline remains robust, with expectations for growth in mid-2026 [37][38] Question: How are competing priorities affecting client decisions? - Management acknowledged that clients are focused on data quality and may prefer to leverage existing capabilities before migrating to Ignite [52][53] Question: What are the growth rates for Ignite versus DOS customers? - Management highlighted a shift in approach to provide flexibility for clients on DOS, allowing for growth opportunities in the apps layer [64][66]

Financial Data and Key Metrics Changes - Total revenue for Q3 2025 was $76.3 million, flat year-over-year, exceeding guidance [7][15] - Adjusted EBITDA for Q3 2025 was $12 million, up 64% compared to Q3 2024, and exceeding guidance of approximately $10.5 million [17] - Adjusted gross margin increased to 53%, up approximately 510 basis points year-over-year [17] - Cash, cash equivalents, and short-term investments decreased to $92 million from $392 million at year-end 2024 [17] Business Line Data and Key Metrics Changes - Technology segment revenue was $52.1 million, representing a 7% year-over-year growth driven by recurring revenue from new and acquired clients [7][15] - Professional services revenue for Q3 2025 was $24.3 million, a 12% decline compared to Q3 2024, primarily due to exiting less profitable contracts [15][17] - Adjusted technology gross margin was 68%, an increase of approximately 330 basis points year-over-year [16] Market Data and Key Metrics Changes - The company anticipates approximately 30 net new platform client additions for 2025, with dollar-based retention expected to be in the low 90% [8][14] - The market remains dynamic, with ongoing financial and workforce pressures impacting client operations [10] Company Strategy and Development Direction - The company is focused on solutions with proven ROI and is committed to delivering meaningful results while maintaining a strong pipeline [8][10] - The leadership team has been strengthened to support long-term vision and improve performance, with recent key appointments [10] - The company is prioritizing areas that will sustain technology gross margin expansion and enhance R&D efficiency [21] Management's Comments on Operating Environment and Future Outlook - Management expects revenue performance in 2026 to be a few points lower than in 2025, driven by dollar-based retention pressures and lower net new client counts [14] - The company is taking a measured approach to setting expectations and will continue to provide updates as the market evolves [14] - Management remains optimistic about the potential for growth in 2026, focusing on cost management and operational efficiency [40][72] Other Important Information - The company is not anticipating pursuing additional acquisitions in the near to medium term, focusing instead on driving growth and profitability from existing capabilities [15] - The Ignite migration initiatives are on track, with approximately two-thirds of DOS clients expected to migrate by the end of 2025 [11][12] Q&A Session Summary Question: What is driving the longer timeline for Ignite migration? - Management noted that some clients prefer to stay on DOS due to its current value and flexibility, which has been positively received [26][28] Question: How does the sequential decline in tech revenue relate to dollar-based retention? - Management explained that the decline is influenced by DOS to Ignite headwinds and the growth in the apps layer, with a mix of moving parts affecting revenue [32][33] Question: What is the value of one-time revenues and the outlook for positive revenue growth? - Management indicated that one-time revenues are becoming more common in professional services, and they expect a robust pipeline to support growth, potentially returning to positive growth by mid-2026 [37][39] Question: How are margins expected to trend into 2026? - Management expressed confidence in EBITDA growth, with Q4 serving as a useful guide for 2026, while acknowledging some one-time items affecting Q4 results [78] Question: What areas are being considered for targeted market expansion? - Management highlighted specific use case areas in cost management and ambulatory offerings where client demand is strong, indicating a focus on leveraging new technologies and AI capabilities [83]

Financial Data and Key Metrics Changes - In Q3 2025, the company achieved revenue of $77.7 million, reflecting a 5% normalized year-over-year growth, while gross profit was $57.8 million, with a 1% increase on a normalized basis [13][14] - Adjusted EBITDA was $31.2 million, representing approximately 40% adjusted EBITDA margins, and free cash flow was $20.8 million, resulting in a 67% free cash flow conversion [15][16] - The company reported a gross profit margin compression of approximately 3.4% year-over-year due to client losses and increased volume discounts [14][15] Business Line Data and Key Metrics Changes - In the consumer payments segment, gross profit increased by 1% year-over-year, with a single-digit increase when excluding the impact of client losses [14][15] - The business payments segment saw a normalized gross profit increase of 12% year-over-year, with over 20% growth when excluding the impact of client losses [10][15] - The supplier network in the business payments segment grew to over 540,000 suppliers, a 60% year-over-year increase [11] Market Data and Key Metrics Changes - The company added five new software partners in Q3, bringing the total partnership network to 291 across consumer and business payment segments [6][11] - The company is focusing on increasing TotalPay adoption and has seen double-digit growth in its accounts payable platform, particularly in healthcare and hospitality verticals [10][11] Company Strategy and Development Direction - The core growth strategy focuses on optimizing digital payment flows and embedding payment technology into software platforms [4][5] - The company is investing in AI tools and automation to enhance client onboarding and improve operational efficiency [5][6] - Capital allocation priorities include organic growth investments, managing CapEx, and maintaining a strong balance sheet while being open to M&A opportunities [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to sustainable growth as they exit 2025, with expectations of 6%-8% normalized gross profit growth in Q4 [17][18] - The company anticipates ongoing margin pressures due to a mix of larger clients with volume discounts and higher transaction values [18] - Management highlighted a stable consumer environment, with some softness noted in the automotive sector [36] Other Important Information - The company repurchased approximately 3% of its outstanding shares in August, totaling $38 million year-to-date, and reduced debt by retiring $73.5 million of convertible notes [12][16] - As of September 30, the company had approximately $96 million in cash and access to $250 million in undrawn revolver capacity, totaling $346 million in liquidity [16] Q&A Session Summary Question: Free cash flow outlook into 2026 - Management expects free cash flow conversion to be in the upper 50s for Q4 2025, with a strong 67% conversion in Q3 [22][23] Question: Political media spend headwind - The headwind from political media contributions in Q4 last year was $4.6 million in gross profit, with an annual impact of approximately $11.75 million [23] Question: Visa Commercial Enhanced Data Program - Management discussed the transition from level two to level three data requirements, which will impact interchange rates and associated fees [28][31] Question: Consumer payments softness - Management noted stable consumer conditions overall but identified softness in the automotive-to-used car segment [36] Question: M&A pipeline and targets - Management indicated a healthy pipeline for M&A opportunities in both consumer and B2B segments, while also focusing on capital allocation priorities [38]