Riskified Ltd.

Good day and thank you for standing by. Welcome to the Riskified Second Quarter 2022 Earnings Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Chet Mandel, Head of Investor Relations.

Good morning. Thank you for joining us today. My name is Chet Mandel, Riskified's Head of Investor Relations. Riskified is hosting this call to discuss its second quarter earnings results for the period ended June 30th, 2022. Participating on today's call, Ari Dogal, Riskified's co-founder and CEO, and Adi Dosheva, Riskified's Chief Financial Officer. Earlier this morning, Riskified issued a press release announcing its financial results for the second quarter of 2022. A copy of this press release has been furnished with the SEC on Form 6-K. Before we begin, I want to remind you that matters discussed on today's call will include the forward-looking statements related to our operating performance, financial goals, and business outlook, which are based on management's current beliefs and assumptions and are not guarantees of future performance. You should not put undue reliance on any forward-looking statements. Please note that these forward-looking statements reflect our opinions as of the date of this call and, except as required by applicable law, we undertake no obligation to revise this information as a result of new development that may occur after the time of this call. Forward-looking statements are subject to various risks, uncertainties, and other factors, some of which are beyond our control that could cause our actual results to differ materially from those expected and described today. In addition, we are subject to a number of risks that may significantly impact our business and financial results. For a more detailed description of our risk factors, we encourage you to read Riskified's periodic and other SEC filings, where you can review the discussion of factors that could cause the company's actual results to differ materially from these statements. A replay of this conference call will be available on our website under the investor relations section. I would also like to remind you that during the call, we will discuss some non-GAAP measures when talking about risk-advised performance. The presentation of this financial information is not intended to be considered an isolation or as a substitute for or a 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. You can find the reconciliation of these non-GAAP measures to the nearest comparable GAAP measures in the earnings press release issued and furnished with the SEC on Form 6K today and in our prior files with the SEC, all of which is posted on our website at ir.riskified.com. I will now turn the call over to Ido Gow, Riskified's co-founder and CEO.

Thanks, Chet, and hello, everyone. Since the year started, I have been and remain Very confident in our go-to-market strategy, the traction with our pipeline of new and existing clients, our strong financial position, and our ability to optimize our expense base through careful cost-saving measures, as we will further discuss on this call. We believe that the impact of the decisions that we have made to support the growth of the business is clearly seen in our results. We continued our positive momentum from the first quarter with another strong quarter, having achieved quarterly revenues of $60 million. of 8% year-over-year. In the face of the current macroeconomic landscape, I am pleased that we were able to continue to increase the amount of gross merchandise volume that we reviewed, with 25 billion reviewed during the quarter, up 18% year-over-year. Overall, for the first six months of the year, our business continues to perform well, and we generated exceptional outcomes for our merchants while continuing to grow, capture market share, and scale our platform. Conversations with our merchants have continued to shift from how do we rapidly grow and fulfill unprecedented amounts of orders at any cost to how can we drive uplifted revenues in a sustainable and profitable manner. The good news for Riskified is that in times like these, we have the ability to help merchants solve this problem through increasing conversion rates while simultaneously decreasing their fraud-related expenses. We believe that the ROI that we can offer today is even more compelling and is a much stronger value proposition than non-guaranteed decisions, which can't address these same problems. Proof of the continuing success that we are having with our merchants was seeing our revenue growth during the quarter, which was primarily driven by new merchants' revenue added in the past 12 months and upsells within portions of our existing customer base. With the addition of these new merchants, we continue to see our top merchant concentration decrease as a percentage of total to reflect a more balanced portfolio. In addition, we continue to be well diversified across verticals and geography. In fact, our top 10 new merchants in the quarter were spread across five different industry areas and three separate geographies. We expect this broad-based and diversified positioning to allow us to continue being resilient across varying macroeconomic environments and throughout different consumer buying patterns. Overall, I'm very encouraged by our first half performance and our ability to execute on the goals that we set for ourselves at the beginning of the year. A top priority for the second half and beyond is to continue to improve efficiency and reduce our overall expense base to recognize additional operating leverage. In order to accomplish this and to help accelerate our path to profitability, we recently reevaluated a number of areas in our expense base, which we will further discuss on this call. As part of this process, We came away with a clear plan, low or higher in pace, a deeper understanding of where to prioritize our investment dollars and how to limit incremental spend while finding opportunities to reduce our overall cost structure. We do not anticipate that this expense reevaluation will impact our long-term growth trajectory. I'm really excited about the progress that we are making in accelerating our path to profitability and I will expand on what this means for our financial outlook. But before that, I want to reiterate a few key points on our ability to deliver long-term value for our merchants and shareholders. First, I continue to believe that the overall addressable market is large in growth, despite a recent general slowdown in some areas of the global economy. Within this large universe, we are a clear market leader of fraud solutions. We believe that we have a superior data advantage to enable the best outcomes and operational improvements for our merchants. which is recognized throughout our relationships with many of the world's largest and highest quality merchants. Second, the stickiness of these relationships is seen through an incredible over 99% customer retention rate. These relationships are deeply integrated and can be challenging to uproot. Combine this with the fact that we are on track to review approximately $100 billion in GMC on an annualized basis in 2022, we have created what we believe to be unrivaled positioning for ourselves in this industry. Third, I am excited to partner with Riskify's new president of worldwide field operations, Ravi Kumarswamy, on our go-to-market strategy. I believe that Ravi, a proven technology leader with more than 20 years of experience, will build upon our existing momentum and spearhead the go-forward sales strategy by focusing on identifying new opportunities to further accelerate our growth. Through our very strong balance sheets and financial position, we believe that we have the financial flexibility to pursue profitable growth. And finally, I believe that we have a tremendous asset in the fact that we have operated the company in a profitable manner in prior periods, and we know the levers to pull and processes to prioritize in order to get back there. I'll now turn it over to Agri, who will cover the financial results in more detail.