Global-E Online Ltd.

Greetings and welcome to the Global E third quarter 2021 earnings call. This call is being simultaneously webcast on the company's website in the investor section under news and events. For opening remarks and introductions, I'll now turn the call over to Erica Mannion at Sapphire Investor Relations. Please go ahead.

Thank you and good morning. With me today from Global E are Amir Shloket, co-founder and chief executive officer, Ofer Koren, chief financial officer, and Nir Devi, co-founder and president. Amir will begin with a brief review of the business results for the third quarter ended September 30, 2021. Ofer will review the financial results for the third quarter followed by the company's outlook for the fourth quarter and full year of 2021. We will then open the call for questions. Certain statements we make may constitute forward-looking statements and information within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995 that relate to our current expectations and futures, excuse me, and views of future events. These forward-looking statements are subject to risks, uncertainties, and assumptions, some of which are beyond our control. In addition, these forward-looking statements reflect our current views with respect to future events and are not a guarantee of future performance. Actual outcomes may differ materially from the information contained in the forward-looking statements as a result of a number of factors, including those set forth in the section titled risk factors in our prospectus filed with the SEC on September 13, 2021, and other documents filed with or furnished to the SEC. These statements reflect management's current expectations regarding future events and operating performance and speak only as of the date of this call. You should not put undue reliance on any forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, We cannot guarantee that future results, levels of activity, performance and events, and circumstances reflected in the forward-looking statements will be achieved or will occur. Except as required by applicable law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events, or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. Please refer to our press release dated November 9, 2021 for additional information. In addition, certain metrics will be discussed today, excuse me, we will discuss today non-GAAP metrics. The presentation of this financial information is not intended to be considered in isolation or as a substitute for or superior to financial information prepared and presented in accordance with GAAP. We use these non-GAAP financial measures for financial and operating decision-making and as a means to evaluate period-to-period comparisons. We believe that these measures provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making. For more information on the non-GAAP financial measures, please see the reconciliation tables provided in our press release dated November 9, 2021. Throughout this call, we provide a number of key performance indicators used by our management and often used by competitors in our industry. These and other key performance indicators are discussed in more detail in our press release dated November 9, 2021. I will now turn the call over to Amir, co-founder and CEO.

Thank you, Erica, and welcome, everyone. I hope everyone is keeping safe and healthy. Thank you all for joining us today for our Quarterly Earnings School, and let's jump straight into our third quarter results. I'm proud to report that Q3 was another record quarter for us. Gross merchandise value, or GMV, grew to $352 million, or 86% growth year-on-year. Revenues for the quarter were $59.1 million, representing 77% year-on-year growth. Our gross profit grew even faster, by 127% year-on-year. reaching $22.8 million. Our gross profitability margin further expanded in Q3 to 38.6%, up from 30.2% in Q3 of last year, thanks to our growing economies of scale and increased efficiencies. Adjusted EBITDA for the quarter totaled $7.7 million, almost tripling year over year, attributed primarily to our highly efficient operating model. Before we dive further in, I would like to mention that from a broader market perspective, during Q3, we have started to see signs of the anticipated return to normality in e-commerce growth trends. We have seen key markets beginning to exhibit various levels of COVID relief in the form of reopening of physical retail, swinging the pendulum of consumer spend slightly back from the record levels of e-commerce market share we have witnessed throughout the height of the pandemic. That being said, we expect e-commerce to continue gaining market share faster than during pre-pandemic times, as new consumer audiences, as well as small to large brands alike, are shifting more weight towards e-commerce. Within e-commerce, the D2C or direct-to-consumer cross-border e-commerce market opportunity is immense and continues to grow significantly faster than the overall e-commerce market. As such, During Q3, we continue to reinvest heavily into our business and have made great progress across all our key strategic growth levers. First, we continue to onboard more merchants onto our platform across all geographies we operate in, while expanding our work with existing merchants and brand groups. For example, our relationship with the LVMH Luxury Group continues to develop as during Q3, we launched with two more group houses, Fanchi and Sephora Asia, the latter contributing to our growing business in Asia Pacific. Another example of a successful new merchant relationship is the fast-growing sports clothing brand Alo Yoga, which is our latest large enterprise brand to go live on the Shopify platform, further exemplifying the value of our strategic partnership with Shopify. This quarter also saw several merchants expanding the scope of their partnership with us to additional lanes. Notable examples include the consumer electronics brand Sennheiser, which added 15 additional markets, the luxury jewelry brand Bouchon, part of the Caring Luxury Group, that added the US and Europe, as well as Spanish footwear brand Camper, which added support for 15 new markets. Second, our direct sales channels continue to be augmented by an ever-expanding list of strong channel partners. The latest partnership we announced is with the Australian Post Group, yielding us access to their vast Australian client base and providing further support for our penetration into the APAC region. Third, we continue to develop and enhance our multi-local support features and capabilities, launching with Jabra, our first global consumer electronics brand, as well as with the football club Leeds United, representing the latest addition to our growing list of sports club merchant partners. Another notable feature we deployed for our merchants at the beginning of Q3 was support for the new OSS and IOSS value-added tax regimes in Europe. With such support provided natively by the Globally platform, the otherwise complicated transition from the old distance-selling VAT regime to the new IOSS one was seamless and transparent for all our merchants. Furthermore, due to the complexity which is involved in supporting the new regime, some of our merchants, such as the sports club Arsenal for example, which in the past operated in Europe by themselves, chose now to move the European markets to be operated by Globally. Across all these channels, our pipeline remains stronger than ever. we continue to put significant effort and resources into our fast-growing strategic cooperation with Shopify. We are seeing great market traction with the Shopify merchant base as part of our partnership with enterprise merchants such as Netflix and Alo Yoga, as well as with a growing number of smaller emerging brands. On the technical side, we recently completed the first phase of our new native integration into Shopify with the first pilot merchant already live and selling through the new seamless plugin. Netflix, whom I have already mentioned, is actually one of the first enterprise merchants to be selling through the new native integration. Over the next quarters, we intend to continue working together with Shopify in order to roll out the additional phases of the new native integration, which is expected to lead to an even more seamless merchant go-live process. Last but not least, In parallel to capturing our fast organic growth opportunities consistent with our previously announced strategy, we intend to continue exploring synergetic M&A opportunities as non-organic options to further enhance our platform's capabilities. As you all know, our people have always been the key element of our success. As such, throughout Q3, we continue to recruit many more great and passionate individuals. They join our super talented and dedicated teams around the globe, helping us build sound foundations of our continued future growth. As part of these efforts, we also recently signed a long-term lease for a new R&D center and headquarters in Israel. We cannot wait to move to our new home in Q2 of next year once the renovation work is done. We are still in the early innings of direct-to-consumer cross-border e-commerce. And within it, we believe that we are just taking off. We are a reputation-first company, and merchants' recognition of the tremendous value we create for them and for the entire ecosystem continues to grow. Day in and day out, more and more merchants from around the world are coming onto our platform to grow their international business and serve their shoppers around the world. We believe that our leading end-to-end solutions coupled with our execution capabilities, position us for rapid growth and success well into the future. And with that, I will hand it over to Ofer, our CFO, to go over our financial results in more depth, as well as provide our outlook for the remainder of the year.