Global-E Online Ltd.

We'll now turn the call over to Alan Katz. Investor Relations, please go ahead.

Thank you, and good morning, everyone. It's great to join the GlobalE team. With me on the call today are Amir Flaquette, co-founder and chief executive officer, Ofer Koren, chief financial officer, and Yurdevi, co-founder and president. Amir will begin with a review of the business results for the first quarter of 2025. Ofer will then review the financial results for the first quarter, followed by the company's outlook for for the second quarter and full year of 2025. We will then open the call for questions. Certain statements we make today may constitute forward-looking statements, and information within the meeting 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 relate to our current expectations 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 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 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 make 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 issued today, May 14, 2025, for additional information. In addition, certain metrics we discussed today are non-GAAP metrics. The presentation of this financial information is not intended to be considered in isolation from or as a substitute for or superior to the financial information prepared and presented in accordance with GAAP. We use these non-GAAP financial measures for financial and operational 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 these non-GAAP financial measures, please see the reconciliation tables provided in our press release issued today. 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 issued today. I will now turn the call over to Amir, our co-founder and CEO. Amir, please go ahead.

I would like to start by welcoming everyone to our first quarterly earnings goal of 2025, and also by extending a special welcome to Alan Katz, our newly joined VP of Investor Relations. Some of you have already met Alan, and all of you will at some point. Welcome on board, Alan, and good luck. As for our financial results, we have had a strong start to 2025, with the first quarter results coming in at or above the midpoints of our guidance regions across the board. Despite the high level of uncertainties driven by the turmoil in duty tariffs and their potential adverse impact on global trade, we have continued to show strong GMV and top-line growth, coupled with strong execution and cost control. We finished Q1 with GMV of $1.24 billion, up 34% year over year, and with revenues of nearly $190 million, up 30% year over year. In terms of profit, our adjusted gross profit for Q1 was $86.3 million, up 31% from last year, and quarterly adjusted EBITDA was $31.6 million, up 48% compared to the same quarter last year, resulting in a 16.6% margin. As Ofer will share with you later in the call, taking into account the trading patterns in April and the first half of May, To date, we have yet to observe clear directional impact from the heightened US import tariffs. However, these are very early days, as the removal of the de minimis on imports into the US of goods that originate from China and Hong Kong, which is the most influential change for direct-to-consumer imports into the US, has only kicked in during the first week of May. Should this situation persist, Some of our U.S. inbound GMV, which represents approximately 12% of our overall GMV, may be negatively impacted from significant retail price increases driven by high tariffs and the removal of the import de minimis. Moreover, future escalation in tariffs and counter-tariffs between the U.S. and its trade partners may further increase uncertainty for merchants and consumers alike and weigh on merchant and consumer confidence around the world. For the time being, the situation remains highly dynamic. It's just today a reduction in excess tariffs and a 90-day pause of further actions between the U.S. and China, which was announced two days ago, is going into effect as they attempt to negotiate a new comprehensive trade deal. We are hopeful that this temporary pause will indeed lead to a broader de-escalation in tariffs around the world. But until then, uncertainties in the market are expected to persist. In parallel, as we discussed during our recent Investors Day in New York, while current uncertainty can lead to disruption or challenges, we see these effects as relatively short to midterm in nature. Over the longer term, we believe this type of increased complexity in the global trade environment provides us with an opportunity to add further value to our existing merchants and to grow with new merchants. The rising complexities of international trade typically bring more and more brands to realize the tremendous business value we can bring to them, as well as our ability to help them to successfully navigate the fast-changing global trade dynamics. As our merchants experience day in and day out, now more than ever, with globally in place, they can have peace of mind during turbulent times. We have their back. As soon as there is a change in regulation or in tariff levels, we not only notify them, But we also take all the necessary steps, including rapid R&D developments and deployments if needed, to make sure that they remain compliant at all times. Not less important, we provide them with data-driven advice and unique features and capabilities that can help them to mitigate potential adverse effects on their international business. We very much see this as an opportunity for continued growth. Taking into account the dynamic nature of all these uncertain factors and their unclear directional impact on our performance in the remainder of the year, we are reiterating our full-year guidance for 2025. We will continue to monitor the situation closely and will update you in the future should our assessments change. Before we review our Q1 results and forward guidance in more detail, I would first like to share with you some of the recent and exciting business developments. First and foremost, I'm happy to announce that we have signed a new three-year strategic partnership agreement with Shopify, replacing our prior 3P and 1P agreements with a new streamlined and unified strategic agreement. For more than four years now, we have fostered a great partnership with Shopify, which has enabled Shopify merchants of all sizes to utilize our state-of-the-art third-party merchant of record solutions, and turbocharge their global direct-to-consumer sales, as well as to enjoy the benefits of the innovative and seamless managed markets offering. The new multi-year strategic partnership agreement we have signed with Shopify incorporates all the mutual learnings from our joint work along the years, as well as the necessary adaptations to support the updated strategic directions and goals of both our companies. Under the new agreement on the 1P or Managed Markets front, Globally will remain the exclusive provider of merchant of record or MRR services for this Shopify branded solution. Globally and Shopify will work together on a revised setup to be launched at a later stage. And these deeper integrations will create a more seamless merchant experience. We believe that once in place, this updated product approach should expand managed markets relevancy and appeal to a far larger cohort of Shopify merchants. It is important to note, though, that this new operating model, which is also expected to impact the commercial structure of managed markets for Globally, is not expected to have a notable effect on 2025 results. Within 3P, the new agreement will enable additional third-party MRR providers to operate on the Shopify platform in the future. we are confident that Globally will be able to maintain its competitive advantage, as we will be the preferred Shopify partner for international MRS services and will retain exclusive access to certain key features available on the Shopify platform. In addition, from a commercial perspective, we stand to benefit from revised commercial terms. Given Shopify's impressive progress in growing and attracting larger businesses globally, This is an exciting extension of our partnership, providing international direct-to-consumer e-commerce support for large sellers on the Shopify platform. This new multi-year agreement is an exciting next step in our relationship with Shopify, one of our most important and long-standing partners, and we are looking forward to seeing where this takes us. I would just quickly note that we have contemplated most of the details around this agreement when we provided our multi-year outlook at our investor day in March. So nothing changes from that perspective, and we remain on track to deliver against our long-term targets for growth and profitability. As I mentioned earlier, merchants are increasingly faced with challenging and highly dynamic trade and regulatory environments, which is exactly where Globally can come in and drive meaningful values. our suite of systems and solutions is not only highly robust, but also agile and flexible, thereby enabling us to quickly develop and deploy new capabilities as the needs of our merchants evolve. One clear example of that is our new 3B2C offering, developed in record time to enable global brands to leverage their international footprint in order to partially offset costs due to tariffs. By using this unique offering, merchants who have legal entities set up in various destination markets can now import goods into such markets as a B2B intra-company transaction before conducting a local in-market sale to the end consumer, thereby lowering the import duties burden. Given the sharp movements we have recently observed in trade tariffs, we have seen a lot of interest from merchants, both existing and new, in using this unique 3B2C offering to mitigate, as much as possible, unnecessary price hikes in key destination markets, while avoiding the cost and ongoing complexities and effort involved in creating full-blown multi-local setups for these markets. Another piece we delivered to our merchants during Q1 was an overall of our merchant portal. Beyond its new look and feel, the newly revamped portal enables for far easier access to frequently used areas, such as order search and others. Most notably, the new portal hosts two important tools for our merchants, a real-time sales dashboard and a funnel analysis dashboard. These self-service BI tools are designed to empower merchants with easy access to their sales data, allowing them to track and analyze key e-commerce KPIs directly in the Global ePortal across all operational markets and using many different metrics and dimensions, keeping merchants in full control of their store's performance around the globe. Such increased visibility and control are always important, but even more so now, as merchants need to be able to understand in real time the impact of various pricing and business decisions they take in reaction to market and regulatory changes. In terms of sales progress in the quarter, we continue to experience strong demand for our services across markets, as dozens of brands went live with Globally during Q1. In Europe, we launched with Subdued out of Italy, and with Viva Footwear, our first large merchant based in Finland. We went live with several luxury brands, including Bali Shoes from Switzerland and Zimmerman in Australia, as well as JW Anderson, an LVMH brand, and Thomas Pink, both out of the UK. We also launched with Diane von Fossenberg in the U.S. During the quarter, we also expanded our portfolio of sports merchants, launching with Atletico Madrid in Spain. Our efforts to grow in Asia-Pacific continue to gain traction as well. During Q1, we launched with Japanese brands United Aeros Tabaia, Sakai, and Bandai Namco, the multinational video game publisher of Pac-Man. We also launched with Three Times and Sumo Undo in Korea, and T2T and Scarlet and Sam in Australia, among others. Lastly, we had a significant expansion of our business with several brands, most notably with the launch of Adidas Hong Kong, one of the biggest markets Adidas has launched with us to date. With the traction we are seeing in the pipeline, dozens of other brands going live, and expansions across our various geographies, We believe we can continue on our growth path towards our long-term targets as merchants continue to leverage our services to support their global direct-to-consumer sales. Before I hand it over to Ofer, I want to highlight another important step in our journey as a mature public company. Starting in Q2, we expect to move to GAAP profitability as the amortization of the majority of the Shopify warrants will be done. By the start of 2026, These are expected to be fully amortized. We expect to be gap profitable also moving forward, signifying our ability to continue generating long-term, durable, and profitable growth. I will now hand it over to Ofer to take us through the quarterly numbers in more depth, as well as our reaffirmed 2025 guidance and the Q2 outlook.