Red Violet, Inc.

Good day, ladies and gentlemen, and welcome to Red Violet's first quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session, and instructions will follow at that time. As a reminder, this call is being recorded. I would now like to introduce your host for today's conference, Camilo Ramirez, Senior Vice President finance, and investor relations. Please go ahead.

Good afternoon and welcome. Thank you for joining us today to discuss our first quarter 2025 financial results. With me today is Derek Dubner, our Chairman and Chief Executive Officer, and Dan McLaughlin, our Chief Financial Officer. Our call today will begin with comments from Derek and Dan, followed by a question and answer session. I would like to remind you that this call is being webcast live and recorded. A replay of the event will be available following the call on our website. To access the webcast, please visit our investors page on our website, www.redviolet.com. Before we begin, I would like to advise listeners that certain information discussed by management during this conference call are forward-looking statements covered under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those stated or implied by our forward-looking statements due to risk and uncertainties associated with the company's business. The company undertakes no obligation to update the information provided on this call. For a discussion of risk and uncertainties associated with Red Violet's business, I encourage you to review the company's filings with the Securities and Exchange Commission, including the most recent annual report on Form 10-K and the subsequent 10-Qs. During the call, we may present certain non-GAAP financial information relating to adjusted gross profit, adjusted gross margin, adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted earnings per share, and free cash flow. Reconciliations of these non-GAAP financial measures to their most directly comparable U.S. GAAP financial measure are provided in the earnings press release issued earlier today. In addition, certain supplemental metrics that are not necessarily derived from any underlying financial statement amounts may be discussed, and these metrics and their definitions can also be found in the earnings press release issued earlier today. With that, I am pleased to introduce Red Violet's Chairman and Chief Executive Officer, Derek Dubner.

Good afternoon, everyone, and thank you for joining us today to discuss our first quarter financial results. We are pleased to report another strong quarter marked by solid execution and continued demand across our business. Our results reflect sustained strength across our diversified customer base, with performance driven by both existing relationships and new customer wins. Despite the persistent volatility in the macroeconomic environment, volumes have remained solid, underscoring the durability and relevance of our solutions. Let's briefly run through the numbers. Revenue for the quarter was up 26 percent to a record $22 million, producing a record adjusted gross profit of $18.3 million and a record adjusted gross margin of 83 percent. Adjusted EBITDA for the quarter was up 47 percent to a record $8.4 million. producing a record adjusted EBITDA margin of 38%, up six percentage points. Adjusted net income increased 53% to a record $4.8 million for the quarter, resulting in a record adjusted earnings of 33 cents per diluted share. Our IDI billable customer base increased by 315 customers sequentially from the fourth quarter, ending the first quarter at 9,241 customers. Within forewarn, we added 21,918 users during the first quarter, ending the quarter with 325,336 users. Over 545 realtor associations are now contracted to use forewarn. We continue to experience strong receptivity from prospective customers, which reinforces the value proposition of our platform. Clients are increasingly turning to us not just for innovation, but for cost-effective, scalable solutions that address mission-critical needs. Our ability to simultaneously deliver innovation and efficiency is clearly resonating. As we look at the broader environment, specifically the economic volatility and uncertainty beginning in the first quarter, it is important to again underscore the durability of our business model, which has consistently proven its strength through multiple economic cycles. From the dot-com bubble, the housing crisis, and the Great Recession, to the unprecedented challenges of the pandemic, This model has proven resilient and even opportunistic during times of stress. This resilience is driven by the diversity of the industries we serve and the critical nature of our solutions. In a strong economic environment, many of our customers, particularly within corporate sectors and financial services, rely on our technology and solutions to support front-end growth use cases, such as new account openings, onboarding, and customer engagement. Conversely, in a more challenging economic climate, when financial pressures mount for consumers and businesses alike, other segments of our customer base become more active. In such times, we see heightened demand from clients focused on legal workflows, investigations, collections, process serving, repossession, and related functions. Additionally, in times of uncertainty, the need for fraud prevention and risk mitigation only increases, and our solutions are essential in helping organizations across the spectrum protect their operations. This counter-cyclical balance in demand ensures that we remain relevant and mission critical regardless of market conditions. It also gives us strong confidence in our ability to continue performing through economic fluctuations while supporting our customers' evolving needs. Over the last few years, we've observed a structural shift in consumer dynamics. where the middle class is no longer anchored in the center, but rather drawn toward the financial extremes that have traditionally defined our core use cases. It is the first time in decades that I've seen this level of activity from both ends of the economic spectrum converge to this degree, where a rising tide is lifting nearly all boats with our business positioned right at the intersection of these trends. Today, our focus remains on a set of strategic priorities, which we've touched on previously, designed to drive long-term value. These include increasing productivity across the organization, analyzing and implementing automation to streamline operations as we scale, and intensifying our efforts around proprietary data generation and aggregation which includes our continued use of AI to derive insights from our core identity graph. We believe these initiatives will further leverage our business model, strengthen our competitive position, and support even stronger financial performance in the medium to long term. Thank you again to our employees, partners, and customers for your continued trust and collaboration. We look forward to building on this momentum in the quarters ahead. Now I'll turn it over to Dan to discuss the financials.