Financial Data and Key Metrics Changes - Total revenues for Q3 2025 reached $956 million, representing a 100% increase year-over-year and a 46% increase sequentially, driven by the integration of Prospect Health and solid organic growth [7][18] - Adjusted EBITDA for the quarter was $68.5 million, up 52% year-over-year and 42% sequentially, indicating strong profitability during aggressive scaling [7][18] - The company ended the quarter with approximately $462 million in cash and short-term investments, and net debt of approximately $624 million, resulting in a net leverage ratio of about 2.5 times on a pro forma trailing 12-month adjusted EBITDA basis [20][50] Business Line Data and Key Metrics Changes - The care enablement segment saw significant growth, more than doubling revenue quarter-over-quarter due to the addition of new provider group clients from Prospect [18] - Medical cost trends remained stable and well-controlled across both legacy Astrana and Prospect businesses, with Medicare trending favorably below the 4.5% expectation for the year [8][18] Market Data and Key Metrics Changes - The company reiterated synergy targets of $12 to $15 million from the Prospect acquisition, focusing on aligning provider and patient experiences, standardizing operating systems, and implementing the Astrana technology platform [9][20] - The partnership with Intermountain Health in Nevada enhances Astrana's presence in a fast-growing market, combining clinical infrastructure with value-based care management capabilities [12] Company Strategy and Development Direction - The company’s strategy is built on four pillars: smart growth, disciplined risk progression, quality and cost excellence, and operating leverage through technology [6] - The integration of AI across the enterprise is expected to drive improvements in efficiency and care quality, with predictive models identifying high-risk patients for earlier interventions [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the integration of Prospect and its potential to enhance performance heading into 2026, despite some anticipated headwinds in Medicaid and exchange businesses due to regulatory dynamics [15][16] - The company updated its 2025 revenue guidance to a range of $3.1 to $3.18 billion and adjusted EBITDA to a range of $200 to $210 million, attributing changes to timing rather than underlying performance [14][21] Other Important Information - The company expects to achieve full onboarding of Prospect's physician groups and care teams to the Astrana platform by mid-2026, with cultural integration being a key focus [9][10] - Cash flow from operations for the quarter was approximately $10 million, contributing to a nine-month total of $118 million, with expectations of full-year free cash flow conversion of approximately 40 to 45% of adjusted EBITDA [20] Q&A Session Summary Question: Revenue guidance update related to full-risk transition timing - Management clarified that the delay was strictly a timing issue related to both legacy Astrana and Prospect businesses, ensuring contract standardization across both [22][23] Question: Details on the Intermountain Health partnership - The partnership aims to enhance care coordination and affordability for patients in Southern Nevada, with potential for future expansion into additional states [24] Question: Medicaid cost trends and expectations - Management anticipates Medicaid margins to stabilize by late 2026, with current trends showing improvement [25][26] Question: Margins by segment - The care enablement segment showed high margins due to rapid growth and effective management, while care partners' margins were slightly lower due to higher trends in the legacy Prospect business [27][28] Question: Medical cost trends and expectations for 2026 - The blended weighted average cost trend was just under 4.5%, with expectations for conservative management in light of potential regulatory headwinds [41][42]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $567 million, down $34 million year-over-year, primarily due to increased accounts receivable cleanup of approximately $20 million [9] - Adjusted EBITDA was $243 million for the quarter, reflecting a margin of 42.9%, which was up 60 basis points sequentially from Q2 [10] - Adjusted free cash flow in the quarter was $122 million, representing a 22% margin or $0.67 per share [12] Business Line Data and Key Metrics Changes - Leasing revenues were $434 million in Q3, a 5% year-over-year decline, but only down 1.3% when excluding write-offs related to accounts receivable cleanup [10][11] - Sales in new and rental units increased by 10% year-over-year [9] - VAPS revenues were flat year-over-year despite volume headwinds, while storage portfolio rates improved by 10% despite a 14% volume decline [11] Market Data and Key Metrics Changes - The Canadian market has seen a slowdown, impacting approximately $130 million of total revenue [34] - The company noted that the traditional storage business remains weak, while climate-controlled storage orders and activations were up approximately 60% year-over-year [48] Company Strategy and Development Direction - The company aims to shift revenue towards more differentiated, higher-value offerings to create consistent results and reduce variability from commoditized lines of business [5][6] - A multi-year network optimization plan is underway to enhance operational efficiency and reduce structural costs, with an estimated $250 million-$350 million of rental fleet units identified for disposal [16][17] - The focus is on reestablishing organic growth through local market initiatives and enterprise accounts, with expectations for enterprise accounts revenue to grow mid to high single digits into 2026 [20][21] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the need for a more conservative approach to guidance to minimize the risk of negative surprises, with revised full-year guidance reflecting current operating conditions [18][19] - The company expects Q4 2025 revenue of approximately $545 million and adjusted EBITDA of around $250 million, with full-year 2025 revenue projected at approximately $2.26 billion [18] Other Important Information - The company has amended and extended its ABL Credit Facility, reducing estimated annual cash borrowing costs by approximately $5 million and extending maturity through October 2030 [14][15] - The company has identified fleet with a net book value of $27 million for disposal, which will help reduce real estate costs and improve operational efficiency [16] Q&A Session Summary Question: Revenue outlook and underperformance - Management identified seasonal storage headwinds and write-off activities as significant contributors to lower revenue outlook, with the Canadian market also underperforming [33][34] Question: Impact of federal government shutdowns - Management reported negligible disruption from federal government shutdowns, maintaining optimism about future opportunities in government sectors [36] Question: Fleet review and potential disposals - The company plans to dispose of excess fleet, which is expected to be around 10% of total fleet, to optimize costs while maintaining adequate market coverage [42][43] Question: Trends in order book and activations - The modular order book is down about 1% year-over-year, but activations have shown low single-digit growth recently, while traditional storage remains weak [48] Question: Changes in operational strategy - Management confirmed that the operational strategy aligns with initiatives laid out at Investor Day, with a focus on asset and network optimization [54] Question: Capital expenditure and growth strategy - Management indicated that the disposal of surplus fleet will not constrain future growth, and capital allocation will focus on differentiated product lines [58][69]

Financial Data and Key Metrics Changes - Tucows reported a 7% year-over-year growth in top-line revenue for Q3, reaching $98.6 million [4][17] - Gross profit increased by 9% year-over-year to $24.2 million, while adjusted EBITDA surged 53% to $13.3 million for the quarter [4][17] - Year-to-date adjusted EBITDA totaled $39.5 million, positioning the company well to meet its full-year guidance of $47 million [4][20] Business Line Data and Key Metrics Changes - Tucows Domains experienced a 5% revenue growth year-over-year, with adjusted EBITDA at $12.1 million, also up 5% [5][19] - Wavelo's revenue grew by nearly 18% year-over-year to $11.9 million, with adjusted EBITDA increasing by 25% to $4.3 million [10][19] - Ting's revenue reached $17 million, an 11% increase year-over-year, with adjusted EBITDA losses improving to $880,000 from $5.1 million [14][19] Market Data and Key Metrics Changes - The wholesale channel in Tucows Domains saw a 5% revenue increase to $58 million, driven by strong reseller demand and higher-margin value-added services [6][7] - The retail segment posted a modest revenue increase of 2% year-over-year to $9.8 million, with gross margin remaining flat [7] - Ting's enterprise and bulk segment revenue grew by 28% year-over-year, contributing significantly to overall performance [15] Company Strategy and Development Direction - The company is evaluating strategic paths for Ting, considering a potential sale to focus on its domain and Wavelo businesses [22] - Tucows aims to streamline its asset base and pivot to a capital-light ISP model, particularly for Ting [18][22] - The management emphasizes disciplined capital allocation and cash conservation, alongside the adoption of AI as key levers for growth [20][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued top-line growth and expanding adjusted EBITDA, despite challenges in the operating environment [21] - There is a cautious sentiment in the telecom sector, with procurement cycles lengthening, but an increase in RFI and RFP activities is noted [12] - The company expects to have a clearer direction regarding the Ting business by the end of the year [22] Other Important Information - The company paid down an additional $2.5 million on its syndicated bank loan, reducing corporate net debt to $189.6 million [4] - A non-cash impairment of $10.9 million related to Ting's inventory and lease assets was recorded, which does not impact cash flow [18] - The management team is undergoing a transition, with a new CEO appointed for Tucows [23] Q&A Session Summary - Questions were invited via email, with responses to be posted on the company's website on November 25 [2][26]

Financial Data and Key Metrics Changes - The company reported a 7% year-over-year growth in top-line revenue, reaching $98.6 million in Q3 2025 [4][17] - Gross profit increased by 9% year-over-year to $24.2 million, while adjusted EBITDA surged 53% to $13.3 million for the quarter [4][17] - Year-to-date adjusted EBITDA totaled $39.5 million, positioning the company well to meet its full-year guidance of $47 million [4][20] Business Line Data and Key Metrics Changes - Tucows Domains achieved a revenue growth of 5% year-over-year, with adjusted EBITDA at $12.1 million, also up 5% from the previous year [5][19] - WaveLow's revenue increased by nearly 18% year-over-year to $11.9 million, with adjusted EBITDA rising 25% to $4.3 million [10][19] - Ting's revenue reached $17 million, an 11% increase year-over-year, with adjusted EBITDA losses improving to $880,000 from $5.1 million in Q3 2024 [14][19] Market Data and Key Metrics Changes - The wholesale channel in Tucows Domains saw a revenue increase of 5% year-over-year, driven by strong reseller demand and higher-margin value-added services [5][6] - The retail segment experienced a modest revenue increase of 2% year-over-year, reflecting a stable performance despite a decline in total domains under management [7][8] Company Strategy and Development Direction - The company is formally involved in a process to sell the Ting business, aiming to strengthen its focus on the Domains and WaveLow segments [22] - The strategy includes divesting non-strategic assets, generating $8.5 million from such sales in Q3 2025 [15][18] - The management emphasizes disciplined capital allocation and the adoption of AI as key levers for future growth [21] Management's Comments on Operating Environment and Future Outlook - Management noted that operator sentiment remains cautious, with procurement cycles lengthening, but there is an increase in RFI and RFP activities, particularly around legacy replacement programs [12] - The company expects to continue benefiting from year-to-date tailwinds while ramping up investments in sales and marketing to drive customer acquisition [10][12] Other Important Information - The company revised its presentation of segment gross profit to align external reporting with internal management practices, which does not affect consolidated financials [17] - A non-cash impairment of $10.9 million related to Ting's inventory and lease assets was recorded, which is excluded from adjusted EBITDA [18] Q&A Session Summary - Questions were invited via email for a recorded response to be posted on the company's website [2][27] - The management team expressed gratitude for the support received over the years and emphasized the ongoing work ahead [25][26]

Financial Data and Key Metrics Changes - Tucows reported a 7% year-over-year growth in top-line revenue for Q3 2025, reaching $98.6 million [4][17] - Gross profit increased by 9% year-over-year to $24.2 million, while adjusted EBITDA surged 53% to $13.3 million for the quarter [4][17] - Year-to-date adjusted EBITDA totaled $39.5 million, positioning the company well to meet its full-year guidance of $47 million [4][20] Business Line Data and Key Metrics Changes - Tucows Domains experienced a 5% revenue growth year-over-year, with adjusted EBITDA at $12.1 million, also up 5% from the previous year [5][19] - WaveLow's revenue grew by nearly 18% year-over-year to $11.9 million, with adjusted EBITDA increasing by 25% to $4.3 million [10][19] - Ting's revenue reached $17 million, an 11% increase year-over-year, with adjusted EBITDA losses improving to $880,000 from $5.1 million in Q3 2024 [13][19] Market Data and Key Metrics Changes - The wholesale channel within Tucows Domains saw a 5% revenue increase to $58 million, driven by strong reseller demand and higher-margin value-added services [5][19] - The retail segment posted a modest revenue increase of 2% year-over-year to $9.8 million, with gross margin remaining flat [6][19] - WaveLow noted a seasonal slowdown in Q3 due to the delivery of professional services, but anticipates a reduction in historical seasonality moving forward [10][12] Company Strategy and Development Direction - The company is formally evaluating strategic paths for the Ting business, with plans to potentially sell it to focus on its domain and WaveLow businesses [22] - Tucows aims to streamline its asset base and pivot to a capital-light ISP model, particularly for Ting [18][22] - The management emphasizes disciplined capital allocation and the adoption of AI as key levers for future growth [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued top-line growth and expanding adjusted EBITDA, despite challenges in the operating environment [21] - There is cautious sentiment in the telecom sector, with procurement cycles lengthening, but an increase in RFI and RFP activities is noted [12] - The company expects to maintain momentum in its core businesses while navigating the transition in Ting [22] Other Important Information - The company paid down an additional $2.5 million on its syndicated bank loan, bringing corporate net debt to $189.6 million [4] - A non-cash impairment of $10.9 million related to Ting's inventory and lease assets was recorded, which does not impact cash flow [18] - The company generated $8.5 million from divestitures in Q3, contributing to a total of $20.8 million year-to-date [15][20] Summary of Q&A Session Questions and Answers - Questions were invited via email to ir@tucows.com until November 13, with a recorded audio response and transcript to be posted on November 25 [1][27]

Financial Data and Key Metrics Changes - The company reported a strong quarter with significant growth, maintaining a revenue-less transaction cost (RLTC) target of 4% for fiscal 2026, indicating a focus on maximizing growth and profitability [22][101] - The operating margin guidance has been raised to over 7.5%, up from the previous guidance of more than 6%, attributed to growth rather than cost-cutting measures [70][72] Business Line Data and Key Metrics Changes - The company highlighted that approximately half of the GMV growth came from direct point-of-sale merchant integrations, with a third from direct-to-consumer channels, indicating a balanced growth strategy [51] - The 0% APR loans have been a significant growth driver, with expectations for continued strong performance in this product category [75][61] Market Data and Key Metrics Changes - The company has seen healthy consumer spending trends, particularly in sectors like sporting goods and outdoor products, with 30-day delinquency rates remaining stable [26][27] - The company is expanding its partnerships with payment service providers (PSPs) to enhance integration speed and market reach, which is crucial for growth in various markets [15][33] Company Strategy and Development Direction - The company has extended its agreement with Amazon for an additional five years, reflecting a long-term commitment to serving customers and enhancing its market position [5][46] - The focus on cash flow underwriting is aimed at capturing younger consumers and those overlooked by traditional credit systems, which is expected to drive growth in the Affirm Card segment [38][40] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the overall health of the consumer base, noting that even during economic uncertainties, repayment rates have remained stable [28][29] - The company is committed to maintaining a strong focus on direct-to-consumer products and enhancing consumer engagement through promotional events and new features [52][60] Other Important Information - The company is actively monitoring macroeconomic trends and adjusting its strategies accordingly to ensure resilience in its operations [29][92] - The management emphasized the importance of building honest financial products that improve lives, indicating a long-term vision for product development [80] Q&A Session Summary Question: Thoughts on funding market execution amidst challenges - Management highlighted their strong execution in the ABS market and capital markets, attributing it to the unique value of their products and strong investor relationships [10][11] Question: Insights on PSP relationships and strategy - Management discussed the importance of PSPs for integration speed and market access, emphasizing their role in expanding merchant partnerships [14][15] Question: Trends in RLTC and future guidance - Management maintained a focus on 4% as an upper bound for RLTC, indicating a long-term strategy to maximize growth and profitability [21][23] Question: Consumer spending environment and delinquency trends - Management confirmed that consumer spending remains healthy, with stable delinquency rates, indicating effective underwriting practices [26][27] Question: Economics of PSPs versus direct integrations - Management noted that PSP agreements are typically bespoke and vary significantly, impacting their international expansion strategy [32][33] Question: Factors driving Affirm Card member growth - Management indicated that cash flow underwriting is beneficial for younger consumers, which is expected to drive growth in card usage [37][40] Question: Insights on Amazon agreement extension - Management expressed satisfaction with the long-term commitment to Amazon, focusing on delivering value to consumers [46][47] Question: Operating margins and expense expectations - Management attributed improved operating margins to growth rather than cost-cutting, with a focus on revenue growth driving operating income [71][72] Question: Competitive environment and capital market conditions - Management noted that the capital markets remain constructive for their assets, with a focus on maintaining strong investor relationships [104][106]

Financial Data and Key Metrics Changes - NdPr oxide production reached 721 metric tons, a 21% sequential increase and a 51% year-over-year increase, marking a record [5] - Adjusted EBITDA was generally unchanged both year-over-year and sequentially, with the decline in profitable concentrate sales offset by improving per-unit cost of production for NdPr [9][10] - Adjusted diluted EPS followed the trend of adjusted EBITDA results, benefiting from higher interest income and a greater income tax benefit [10] Business Line Data and Key Metrics Changes - In the materials segment, REO production was strong at 13,254 metric tons, slightly down from the record-setting quarter in Q3 of the previous year [10] - Separated product sales volumes saw nearly 20% sequential growth and 30% year-over-year growth, with a lag between production volume growth and sales due to toll processing [11] - The magnetics segment received a $40 million prepayment from Apple for magnet production from recycled materials, with additional prepayments expected as progress continues [8][12] Market Data and Key Metrics Changes - Improved market pricing over the last year positively impacted realized pricing, with expectations for next quarter's realized price to approximate $61 per kilogram [13] - The absence of concentrate revenue was mostly offset by the ramp in separated product sales, primarily NdPr, and magnetic precursor product sales [9][14] Company Strategy and Development Direction - The company is focused on vertical integration and aims to restore America's ability to produce magnet-grade heavies at scale [7][28] - The long-term purchase price agreement with the Department of War commenced on October 1st, providing earnings visibility and a transformed economic foundation [7][15] - The company is committed to producing samarium oxide by 2028 and is exploring additional heavy rare earth production opportunities [50] Management's Comments on Operating Environment and Future Outlook - Management highlighted the necessity for self-sufficiency and resilience in the rare earth supply chain, emphasizing the strategic importance of domestic production [29][30] - The company expects to return to profitability in Q4 of this year and beyond, with strong growth anticipated in Q1 2026 [7][15] - Management expressed confidence in the ability to ramp production and meet market demands while maintaining a focus on operational efficiency [60][64] Other Important Information - Capital spending through Q3 totaled approximately $110 million, with expectations for full-year gross CapEx to be closer to the low end of the initial range [21] - The company is actively engaged with various potential feedstock providers to supplement its own contained heavy rare earth content [24] Q&A Session Summary Question: How long could the SEG+ stockpile support heavy production once fully ramped? - The company has several hundred tons of SEG stockpiled and is confident in its inventory to support commissioning the circuit [41] Question: How is customer engagement going beyond Apple and GM? - There is significant engagement across various verticals consuming magnets, with a focus on executing for foundational customers [44] Question: What is the timeline for producing other rare earth metals of interest to the DoD? - The company has committed to producing samarium in 2028 and is in discussions for other materials based on demand [51] Question: Can you clarify the $200 million prepayment from Apple? - The next payment is expected in Q4, with prepayments continuing as operational milestones are met [52] Question: How do you prioritize sourcing recycled material versus third-party feed? - The company takes an all-of-the-above approach, focusing on scaling operations while being opportunistic about feedstock acquisition [62][64]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $4.1 billion, representing a 10% year-over-year increase [19] - Adjusted EBITDA reached over $2 billion, marking the highest quarterly figure ever, with a 50% EBITDA margin [19] - Gross booking value (GBV) grew 14% year-over-year to $22.9 billion, driven by strong growth in both bookings and pricing [18] - Net income was $1.4 billion, with earnings per share (EPS) of $2.21, reflecting a 4% year-over-year growth [19] - Free cash flow for Q3 was $1.3 billion, contributing to a total of $4.5 billion over the past 12 months, resulting in a free cash flow margin of 38% [20] Business Line Data and Key Metrics Changes - Nights and seats booked increased by 9% year-over-year, with a two-point sequential acceleration from Q2 [18] - International expansion markets saw average nights booked grow at double the rate of core markets, with first-time bookers up over 20% in Japan and nearly 50% in India [8][9] - The launch of Airbnb Services and Experiences has received positive feedback, with an average rating of 4.3 out of 5 stars [9] Market Data and Key Metrics Changes - Nights growth across major regions remained steady or accelerated, with Latin America growing in the low 20s and Asia-Pacific in the mid-teens [18] - The U.S. market showed significant acceleration from Q2 to Q3, partly due to the Reserve Now, Pay Later payment offering [18] Company Strategy and Development Direction - The company is focusing on four key growth areas: improving service quality, expanding globally, diversifying offerings, and integrating AI into the app [5][12] - The strategy includes launching hotels on the platform, targeting boutique and independent hotels, and enhancing the user experience with new search filters and room type selections [11][54] - The integration of AI aims to create a more personalized experience for users, with features like AI customer support and AI-powered search being rolled out [12][77] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the continued momentum into Q4, expecting revenue growth of 7%-10% year-over-year [21] - The company anticipates a sequential acceleration in growth from Q3 to Q4, despite tougher year-over-year comparisons [22] - Management highlighted the importance of maintaining strong margins while investing in growth initiatives for 2026 [22] Other Important Information - The company repurchased $857 million of common stock during the quarter, with a total of over $3.5 billion repurchased in the trailing 12 months [20] - A one-time $213 million valuation allowance impacted net income due to changes in tax legislation [19] Q&A Session Summary Question: What percentage of the acceleration in the U.S. has come from the Reserve Now, Pay Later offering? - About 70% of those offered the Reserve Now, Pay Later option have utilized it, and while there are increased cancellations, the net impact is a lift to net bookings [25][26] Question: How should investors think about the duration of execution and investment needed for international markets? - Each market takes a different timeline, with significant market share gains seen in Latin America and promising progress in Japan [30][32] Question: Is the events and experiences segment contributing to revenue, and what are the retention signs? - Experiences are bringing new audiences to Airbnb, with about half of those booking experiences not having an associated stay [36][38] Question: How does the company plan to layer on hotels in markets where it is currently shut out? - Hotels are seen as a promising opportunity, with pilots underway in key markets like New York City and Madrid [46][50] Question: What are the long-term ambitions for hotel merchandising and booking experience? - The company envisions becoming a one-stop shop for travel, focusing on boutique and independent hotels while ensuring the hotel business is incremental [54][56] Question: What new billion-plus opportunity products and services can be expected in 2026? - The company is on pace to launch at least one new business each year, with a focus on service experiences and hotels [60][62] Question: What are the remaining pain points that need more work? - The company aims to improve payment flexibility, quality control, and pricing tools for hosts, while also enhancing map and location information [82][84]

Financial Data and Key Metrics Changes - In Q3 2025, consolidated revenue was $239 million, up 3% year-over-year [28] - Marketplace revenue was $232 million, reflecting a 14% year-over-year increase, driven by subscription-based listings revenue [29] - Non-GAAP gross profit was $214 million, an 11% increase year-over-year, with a non-GAAP gross margin of 90%, up about 650 basis points [30] - Adjusted EBITDA was approximately $79 million, up 21% year-over-year, with an adjusted EBITDA margin of 33%, up about 490 basis points [31] - Non-GAAP diluted earnings per share was $0.57, a 30% increase year-over-year [34] Business Line Data and Key Metrics Changes - U.S. CarSID grew 8% year-over-year, with 1,182 new paying U.S. dealers added [29] - International operations saw revenue growth of 27% year-over-year, with international CarSID up 15% year-over-year [29] - Digital Deal adoption surpassed 12,500 dealers, with significant growth in high-value actions such as financing applications and appointment scheduling [21] Market Data and Key Metrics Changes - The international market is showing strong growth, with CarGurus adding over 800 customers in Canada and the U.K. [54] - The company is maintaining lower pricing in international markets to build market share before increasing prices over time [54] Company Strategy and Development Direction - The company is focused on expanding its suite of data-driven solutions across dealer workflows to enhance profitability [11] - CarGurus aims to deepen monetization through scalable software and data solutions, expanding its addressable market significantly [9][10] - The strategy includes enhancing consumer engagement through innovations like CG Discover and Dealership Mode, which aim to streamline the car buying journey [16][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength and growth of the marketplace, with expectations for continued investment in AI-centric innovations [37] - The company anticipates fourth-quarter marketplace revenue to be between $236 million and $241 million, representing a year-over-year increase of 12% to 15% [35] - Management highlighted the importance of maintaining a balance between innovation and disciplined execution to ensure sustainable growth [80] Other Important Information - The company is winding down the CarOffer transactions business, which will be accounted for as a discontinued operation in Q4 [30] - Total wind-down-related charges are expected to be in the range of $13 million to $15 million, lower than previously estimated [33] Q&A Session Summary Question: What is the trend regarding dealers using CarGurus? - Management noted that dealers are using fewer marketplace partners, with the average dropping from three to under two, indicating consolidation towards those offering the best ROI [41] Question: How is the ROI for Digital Deal perceived by dealers? - Management indicated that more consumers are engaging in high-value actions, which drives higher quality leads and further ROI for dealers, suggesting potential for future pricing power [45] Question: What are the growth prospects in international markets? - Management expressed pride in international growth, emphasizing the strategy of maintaining lower prices to build market share before increasing them over time [54] Question: How does CarSID growth relate to dealer rooftops? - Management explained that CarSID growth is mathematically related to the number of rooftops, with recent growth in rooftops acting as a headwind to CarSID growth [67] Question: What insights are generated from Dealership Mode? - Management highlighted that Dealership Mode provides valuable insights into consumer behavior at dealerships, enhancing the understanding of customer engagement [82]

Financial Data and Key Metrics Changes - Total revenue for Q3 2025 was $136.9 million, representing a 26% year-over-year increase [7][23] - Operating margin improved to 18.7%, up from 13.5% in Q3 2024 [26] - Cloud revenue reached $63.4 million, a 50% increase year-over-year, accounting for 46% of total revenue compared to 39% in the prior year [24][26] - Gross profit was $114.9 million, with a gross margin of 83.9%, up from 82.8% in the year-ago period [25][26] - Net dollar retention was 118%, consistent with the prior quarter, indicating sustained growth among existing customers [9][25] Business Line Data and Key Metrics Changes - Enterprise Plus subscriptions contributed 56% of total revenues, up from 50% in the previous year, with a 39% year-over-year growth in revenue from these subscriptions [24][25] - Customers spending over $1 million annually grew to 71, a 54% increase year-over-year [8][26] - Customers spending more than $100,000 annually increased to 1,121, a 16% year-over-year growth [8] Market Data and Key Metrics Changes - The company noted strong cloud growth driven by increased usage of various software packages, including AI-related artifacts [8][10] - The demand for JFrog's security solutions has been a significant driver of cloud revenue growth [36] Company Strategy and Development Direction - JFrog aims to position itself as a foundational platform for software delivery, focusing on cloud and security solutions [7][10] - The company is embracing AI and machine learning, integrating these capabilities into its platform to enhance software supply chain management [16][22] - JFrog introduced the DevGovOps solution to address the growing need for governance and compliance in software delivery [18][19] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding future growth, emphasizing the importance of security and governance in the current market landscape [15][29] - The company is prepared for ongoing macroeconomic volatility while maintaining a focus on profitable growth [28][30] Other Important Information - JFrog completed payments of $5.7 million related to the acquisition of Qwak, which was finalized in July 2024 [28] - The company ended Q3 2025 with $651.1 million in cash and short-term investments, up from $522 million at the end of 2024 [28] Q&A Session Summary Question: Was there anything one-time in the cloud revenue results? - Management confirmed that the strong cloud revenue was not due to one-time events but a combination of strong usage across multiple package types and security solutions [36] Question: What has changed in the go-to-market execution for cloud? - Management highlighted consistent execution and a strategy of converting customers with overusage to higher commitments, leading to stable cloud growth [38] Question: Can you elaborate on the types of artifacts managed by Artifactory? - Management noted an increase in the usage of AI-related artifacts alongside traditional software artifacts, indicating a growing trend [42] Question: How relevant is the UI/UX change due to AI for JFrog? - Management acknowledged the importance of adapting to AI-driven software creation and emphasized the need for agentic capabilities in their offerings [45] Question: What is the outlook for net dollar retention? - Management indicated that net dollar retention remains stable at 118%, with expectations for continued growth driven by security solutions and increased cloud usage [50] Question: How is the pipeline for security deals tracking? - Management reported a growing pipeline for security solutions, although sales cycles are longer due to the need to displace existing solutions [88]