Cardlytics, Inc.

the Q3 2025 Cardlytics, Inc. Earnings Conference Call. At this time, all lines are in lesson only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on November 5th, 2025. And I would like to turn the conference over to Nick Clinton. Thank you. Please go ahead.

Good evening and welcome to the Cardlytics third quarter 2025 financial results call. Before we begin, let me remind everyone that today's discussion will contain forward-looking statements based on our current assumptions, expectations, and beliefs, including expectations around our future financial performance and results, including for the fourth quarter of 2025, the growth of CRP and the launches of new CRP partners, our capital structure, increasing our supply in operational and product initiatives. For a discussion of the specific risk factors that could cause our actual results to differ materially from today's discussion, please refer to the risk factors section of our 10-Q for the quarter ended September 30, 2025, which has been filed with the SEC. Also during our call, we will discuss non-GAAP measures of our performance. GAAP financial reconciliations and supplemental financial information are provided in the press release issued today, which you can find on the investor relations section of the Cardlytics website. Today's call is available via webcast, and a replay will also be available on our website. On the call today, we have CEO Amit Gupta and CFO Alexis DiCieno. Following their prepared remarks, we'll open it up for your questions. With that, I'll hand the call over to Amit.

Good evening, and thank you for joining us today. On our last call in August, we shared updates on the steady progress we made across our key priorities, as well as the headwinds we would be facing starting Q3. As a reminder, these headwinds are stemming from our largest FI partner's decision to block our advertiser content from running on their channels. Overall, our Q3 billings results were in line with our expectations as we actively work to shift volume to other partners in our network and learn from our mitigation strategy. In parallel, we have taken a series of steps to ensure the long-term sustainability and success of our company and maintained our relentless focus on our key business pillars. First, increasing and diversifying our supply to meet consumers where they are. Our relationships with financial institutions continue to expand in both scope and depth, reinforcing the strategic value of our network, especially in light of replacing the supply we have lost from our largest FI partner. For example, with one bank partner, we expect to soon add their debit and SMB portfolios to our program, which represents a significant opportunity to deepen engagement with their customers and expand our reach. We believe that strengthening consumer engagement is just as effective as adding new users, and we remain focused on doing this through new and innovative capabilities. For example, we recently ran a double-days campaign where rewards were doubled on specific days to drive a sense of urgency. This campaign grew consumer engagement by approximately 15%. In addition, building on previous success with one of our larger bank partners, we are expanding category level offers in Q4. These offers reward customers for spending in a specific category rather than with a specific advertiser and have proven to be effective in driving engagement with our offers. In Q2, we tested this with gas and grocery, and in Q3, we took our learnings to the entertainment category. Once again, these campaigns have demonstrated that category-level offers are highly effective in creating a halo effect. Seventy-three percent of consumers who redeemed a category-level offer also redeemed another offer. Due to the decision of our largest FI partner, approximately one-third of our total billing were set to be blocked. But we were able to mitigate a significant portion of the drop because the rest of our network is more than 2.5 times larger than our largest FI partner alone. We can increase content shift to other banks with M2U capacity and also increase engagement with those banks' customers. By doing more of this, we would be on the path to make up the billing shortfall with better margins. Turning to Cardletics Rewards Platform, our network of non-FI publishers, we are excited to share positive momentum from last quarter. We signed three new partners in the U.S., including OpenTable, a global leader in restaurant technology. Through this partnership, we plan to help boost engagement and loyalty with OpenTable's large user base as part of their recently revamped loyalty program. We look forward to sharing updates on when we expect to launch with OpenTable. For our other two CRP partners, we expect to launch in Q4 after testing and integration, which is currently underway. We see CRP as a significant growth opportunity. Not only does CRP allow us to meet more consumers where they are, it can also help our traditional FI partners by enabling us to bring new advertisers and verticals to our platform. Additionally, we have seen an increase in our pipeline since last quarter as a result of customer loyalty becoming a more central focus in the market. We believe Cardlytics is perfectly positioned to be a commerce media partner for leading companies looking to accelerate their advertising efforts while delivering value to their customers. Now, moving on to our second pillar. strengthening and growing advertiser demand. Leading advertisers continue to recognize the unique value of our network and capabilities. While commerce media is undergoing a fundamental shift, advertisers have not lowered their standards. They continue to seek measurable outcomes and sophisticated capabilities to leverage different ad formats and micro-target customers. With our existing advertisers, we are building trust by continuing to build campaigns that deliver results. Of note, most advertisers have decided to stick with Cardlytics despite the supply changes with our largest FI partner. In fact, for the partners that run Parlinked offers with Cardlytics, as well as a competitor program, we consistently hear that our incremental ROAS is superior. On the new business front, we signed pilots with iconic brands, such as a large athletic apparel brand and a global hotel brand, and 100% of our new business was on engagement-based pricing. We have also been focused on winning back key accounts. Several notable brands, including a global coffee chain and a global discount grocer, have rejoined our network, which we believe underscores our ability to drive performance for our advertisers. One of the core value propositions of our platform is that we drive both online and in-store sales. We have enhanced our geo-targeting capabilities over the last six months and implemented different reward amounts between online and offline purchases, as well as newer features like shop at targeting, which targets users where they buy, not just where they live. Many auto gas and restaurant chains have used our multi-location reports to assess performance, identify top performing locations, and inform franchise marketing efforts. Geo-targeting also helps engagement with franchises that often have independent marketing budgets. Our UK business continues to show strength with 22% revenue growth year over year, This quarter, we were able to grow budgets with all our top advertisers and close a large number of new logos across grocery, gas, restaurant, and retail. We are now working with all of the top five UK grocers up from four previously and ongoing recognition of the strength of our platform. And finally, last quarter, we added another localized content partner to expand our always-on third-party content for our publishers. We can now deliver nearly 10,000 local and regional offers, which we are now providing to our smaller banks that did not have local offers previously. Additionally, with our new partnership with OpenTable, not only will they be joining our platform as a publisher, but also as a content provider, bringing their restaurant partners to our network for the benefit of all our publishers. We believe all these initiatives drive awareness and relevancy for the program and deepen engagement with consumers. Now, turning to network performance. Building on the work we've done to modernize our tech stack, we continue to strengthen our engineering foundation to benefit our clients and improve internal productivity. While our models continue to become stronger with higher predictability, we experienced some aberrations in July as supply changes began to take effect. These issues stabilized by the end of the quarter, and while they caused some choppiness in our margins, they are making our delivery models better at handling large-scale changes. We are also advancing the integration of our measurement models with widely adopted industry standards, which we believe make it easier for our advertisers to evaluate performance across channels. Building on our efforts to ensure Cardlytics data is properly modeled in leading MMMs, we are now integrating with more partners to automatically feed our data into their dashboards. These changes help to retain our existing clients and, we believe, outperform other channels. The performance of our network remains strong, reinforced by the impact and efficiency of the campaigns delivered through our platform. With the investments we've made in our models, our platform continues to perform better for our advertisers and bank partners, with a 21% year-on-year improvement in ROAS. Last but not least, our bridge business. In Q3, we saw continued interest in our identity resolution product, both from existing clients and new prospects. including a grocer that engaged Bridge to gain access to previously unavailable insights around shopper behavior. This will allow them to significantly enhance their ability to understand, engage, and target individuals driving increased frequency, spend, and loyalty. I'm also pleased to share that we recently signed a two-year renewal with a large fast food chain. On Ripple, we continue to make progress on both supply and demand. On the supply side, we added two new retailers to the Ripple network. We also continued to grow our demand, which resulted in the second consecutive quarter of doubling our revenue. Before I turn it over to Alexis, I want to touch on the actions we took in Q3 to strengthen our financial foundation and sharpen operational focus. In September, we fully paid the $46 million remaining on our 2020 convertible notes. Last month, we took a difficult but necessary step in reducing our workforce to ensure we can continue to operate sustainably and preserve the long-term financial health of our company. This latest reduction reflects a 30% decrease in our workforce, as well as reductions to third-party spend, real estate, and operations, and we expect these reductions to deliver annualized cash savings of $26 million. This follows prior reductions this year of $16 million in May and $8 million in January for a total of $50 million. We are deeply appreciative of the contributions of the colleagues who departed as part of these changes. As a leaner organization, we are now moving forward with more focus and discipline. Looking ahead, we are simplifying our strategic priorities in 2026 We plan to further solidify our foundation and grow our commerce media platform. We will focus on expanding our CRP partner cohort while strengthening our existing FI partnerships. To unlock increased advertiser budgets, we will lean into value propositions that are in demand and where we believe we can deliver a differentiated product such as omni-channel performance. By doubling down on where we are best in the industry, we believe we can get back on a path to growth. I'll now turn it over to Alexis to discuss the financials.