Executive Summary

Q3 2025 revenue was $52.0M, down 22% YoY and slightly below the prior guidance low-end ($52.2–$58.2M), while Adjusted EBITDA of $3.2M was above the high end of guidance, reflecting a leaner cost base and improved partner mix .
The company executed a 30% workforce reduction in October, targeting at least $26M in annualized cash savings and guiding Q4 Operating Expenses to $27–$28M (ex-SBC/severance), supporting positive Adjusted EBITDA expectation for Q4 and FY25 .
Content restrictions at the largest FI partner pressured billings and U.S. revenue; mitigation includes shifting volume to other FI partners, expanding CRP non-FI supply (e.g., OpenTable), and deeper engagement initiatives (category-level offers, “Double Days”) .
KPIs mixed: MQUs rose 21% YoY to 230.3M, but ACPU fell to $0.11 from $0.16; Adjusted Contribution margin hit a record 57.7% of revenue on improved bank economics; UK revenue grew 22% YoY .
Near-term stock catalysts: Q4 guide implies positive EBITDA despite top-line pressure; rapid progress shifting to a high-margin FI mix and CRP partner launches; execution on supply diversification and engagement could drive estimate revisions and sentiment .

What Went Well and What Went Wrong

What Went Well

Record Adjusted Contribution margin as % of revenue (57.7%) driven by improved bank mix; Adjusted EBITDA of $3.2M beat the prior guidance range high and turned positive YoY .
MQUs rose 21% YoY to 230.3M, reflecting full ramp of new FI partners; UK revenue grew 22% YoY with new logos and larger budgets from top accounts .
Strategic reset and cost actions: 30% workforce reduction and other spend cuts expected to deliver at least $26M annualized savings; CEO: “reset our business…set ourselves on a viable path to return to growth” .

What Went Wrong

Revenue declined 22% YoY to $52.0M; ACPU compressed to $0.11 from $0.16 YoY as largest FI partner blocked advertiser content, driving billings declines and margin choppiness early in the quarter .
U.S. revenue (ex-Bridg) fell 28%; Bridg revenue declined 15% due to a lost major account in prior quarters, highlighting ongoing category and account concentration risks .
GAAP results burdened by a $58.8M impairment of goodwill and intangibles, contributing to a GAAP net loss of $(72.7)M and GAAP diluted EPS of $(1.36) .

Financial Results

Metric	Q1 2025	Q2 2025	Q3 2025
Revenue ($USD Millions)	$61.898	$63.249	$52.031
Adjusted Contribution ($USD Millions)	$32.448	$36.146	$30.030
Adjusted Contribution Margin (% of Revenue)	52.4%	57.1%	57.7%
Adjusted EBITDA ($USD Millions)	$(4.384)	$2.703	$3.204
Net Loss ($USD Millions)	$(13.282)	$(9.283)	$(72.673)
GAAP Diluted EPS ($USD)	$(0.26)	$(0.18)	$(1.36)
Adjusted Net Loss per Share (Diluted) ($USD)	$(0.21)	$(0.13)	$(0.07)
Free Cash Flow ($USD Millions)	$(10.809)	$(3.431)	$(2.703)

Segment breakdown (platform):

Metric	Q1 2025	Q2 2025	Q3 2025
Cardlytics Platform Revenue ($USD Millions)	$56.435	$58.041	$46.962
Bridg Platform Revenue ($USD Millions)	$5.463	$5.208	$5.069

KPIs:

KPI	Q1 2025	Q2 2025	Q3 2025
MQUs (Millions)	214.9	224.5	230.3
ACPU ($ per user)	$0.13	$0.14	$0.11

Guidance Changes

Q4 2025 Guidance:

Metric	Period	Previous Guidance	Current Guidance	Change
Billings ($USD Millions)	Q4 2025	N/A	$86.0–$96.0	Initiated
Revenue ($USD Millions)	Q4 2025	N/A	$51.1–$59.1	Initiated
Adjusted Contribution ($USD Millions)	Q4 2025	N/A	$29.0–$35.0	Initiated
Adjusted EBITDA ($USD Millions)	Q4 2025	N/A	$0.9–$7.9	Initiated
Revenue/Billings Margin (%)	Q4 2025	N/A	Low 60%	Initiated
Adjusted Contribution Margin (% of Revenue)	Q4 2025	Mid-50% (Q2 guide)	Mid–High 50%	Raised/maintained high end
Operating Expenses excl. SBC & severance ($USD Millions)	Q4 2025	N/A	$27–$28	Initiated

Q3 2025 Actual vs Prior Guidance (set on Aug 6):

Metric	Period	Prior Guidance (Aug 6)	Actual	Outcome
Billings ($USD Millions)	Q3 2025	$87.0–$95.0	$89.193	In-line
Revenue ($USD Millions)	Q3 2025	$52.2–$58.2	$52.031	Slight miss vs low-end
Adjusted Contribution ($USD Millions)	Q3 2025	$30.3–$34.3	$30.030	In-line at low-end
Adjusted EBITDA ($USD Millions)	Q3 2025	$(2.3)–$2.7	$3.204	Beat; above high-end

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 2025)	Previous Mentions (Q2 2025)	Current Period (Q3 2025)	Trend
Supply diversification (FI and non-FI)	Launched CRP with first non-FI partner; newest large FI and neobank ramping; faster integrations (SDK/APIs)	Scaling local offers and Rippl network; traction with retailers (Hy-Vee, Wegmans, Giant Eagle)	Mitigating largest FI content restrictions by shifting volume to other banks; signed three new CRP partners incl. OpenTable	Accelerating diversification
Advertiser demand and pricing	74% on engagement-based pricing; targeting omnichannel behavior; Insights portal adoption	Growing local offers and geo-targeting capabilities; multi-location performance reporting	Strategic pricing to drive ROAS; most advertisers retained despite supply changes; pilots with athletic apparel and global hotel brands	Stable to improving mix; competitive pricing
Technology/measurement	Modernizing tech; delivery issues largely resolved; geo-targeting enhancements	MMM integrations and data feeds; expanding local/regional offers	Models stabilized after July aberrations; integrating with partners’ dashboards; October billing margin improved	Improving stability and measurement
Macro/tariffs	Consumers front-running purchases ahead of tariffs; category softness (travel)	Advertiser caution persists; everyday spend resilient	Top-line pressured by FI content restrictions; holiday promotions starting earlier; U.K. strength	Mixed macro; operational headwinds
Regional trends (U.K.)	U.K. growth noted; new brands signed	Strength across categories; expanding grocers	22% U.K. revenue growth; working with top five U.K. grocers	Improving
Bridg/Rippl (identity/retail media)	Bridg pipeline; SKU-level pilot with CPG offers on bank partner	Rippl demand growth; retailer adds; DSP engagement	Bridg wins and two-year renewal; Rippl supply and demand added; second consecutive quarter of doubling revenue	Strengthening momentum

Management Commentary

CEO: “In Q3, we've taken decisive action that we believe will reset our business, improve our financial health, and set ourselves on a viable path to return to growth…prioritizing initiatives that build on our fundamental strengths and where we believe we can win” .
CFO: “We surpassed the high end of our guidance for adjusted EBITDA…adjusted contribution as a percentage of revenue to 57.7%, the highest we have experienced to date, driven primarily by growth of our newest FI partners” .
CEO: “Approximately one-third of our total billings 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 2.5x larger than our largest FI partner alone” .
CFO on cost base: “For the fourth quarter, we expect operating expenses to be at or below $28 million, excluding stock-based compensation and severance…a $3–$4 million sequential improvement quarter over quarter” .

Q&A Highlights

Margins: Management attributed Q3 billings-to-revenue margin weakness largely to July’s abrupt supply changes; margins normalized by quarter-end, with October run-rate higher; Adjusted Contribution margin at ~58% expected to be stable/high-50s given favorable bank mix .
Guidance puts/takes: The $7M Adjusted EBITDA range is driven by top-line and margin variability; OpEx guided $27–$28M, with limited variance, implying flow-through sensitivity to revenue/contribution .
Mitigation progress: Nearly 3x advertisers activated on the newest large FI partner vs Q1; October billings ~50% higher than Q3; activation rate is 2x network average .

Estimates Context

Metric	Q3 2025 Consensus	Q3 2025 Actual	Surprise
Revenue ($USD)	$54.54M*	$52.03M	Miss*
Primary EPS ($USD)	$(0.15)*	$(0.07)	Beat*

Values retrieved from S&P Global.*
Note: Company-reported Adjusted EBITDA was $3.2M , while consensus often tracks EPS and revenue. Where non-GAAP (Adjusted) metrics are central to the narrative, we anchor to company disclosures and reconciliations.

Where estimates may adjust:

Potential upward bias to EBITDA/Adjusted Contribution assumptions given high margin retention and cost base reset; downward bias to U.S. revenue/ACPU near-term reflecting FI content restrictions and strategic pricing .

Key Takeaways for Investors

Execution beat on profitability: Adjusted EBITDA above guidance high despite revenue headwinds; cost actions and bank mix support continued EBITDA positivity into Q4 and FY25 .
Supply shift is working: Rapid advertiser activation and higher October billings at the newest large FI partner underpin mitigation of the largest FI restriction; watch pacing into Q4/Q1 .
Pricing and engagement: Strategic pricing funded by higher-margin bank mix is driving ROAS and retention; category-level offers and “Double Days” lift engagement (e.g., ~15% engagement uptick) .
UK resilience: 22% YoY revenue growth with all top five grocers on platform provides diversification and a bright spot amidst U.S. headwinds .
Non-FI expansion: CRP (e.g., OpenTable) broadens supply and could unlock new advertiser categories in 2026; 2025 financial impact minimal but strategically important .
Watch impairments vs adjusted metrics: Large non-cash impairment weighed on GAAP results; focus on Adjusted Contribution, margin, and cash metrics for operating trajectory .
Near-term trading lens: Stock likely sensitive to execution on Q4 guide (revenue/billings margin in low 60s; Adjusted Contribution margin mid–high 50s), evidence of continued advertiser retention and CRP launches, and any updates on FI partner restrictions easing .

Cardlytics, Inc. (CDLX)·Q3 2025 Earnings Summary