Executive Summary

Q3 revenue declined 16% year over year to $83.3M while adjusted EBITDA was $16.6M (20% margin), above the top end of guidance; GAAP diluted EPS was $0.05 and adjusted diluted EPS was $0.56 . Management noted revenue landed in the upper half of prior guidance and adjusted EBITDA was “well above” the range .
Network demand remained healthy: redeemers grew 19% YoY to 18.2M, driven by Instacart and majority rollout to DoorDash customers; however, redemptions per redeemer fell 28% YoY, pressuring revenue mix toward third‑party publishers .
Q4 outlook guides revenue to $80–$85M (−16% YoY at midpoint) and adjusted EBITDA to $9–$12M (≈13% margin midpoint) as marketing seasonality and fully staffed sales drive higher OpEx before LiveLift contributes meaningfully to top line .
Strategic catalysts: launch of LiveLift (in‑flight incremental sales measurement/optimization) and Circana partnership for independent lift studies; early client pilots and re-ups support the performance marketing transformation narrative into 2026 .

What Went Well and What Went Wrong

What Went Well
- Adjusted EBITDA outperformed: $16.6M (20% margin) vs guidance of $9.5–$13.5M in Q3; CFO highlighted adjusted EBITDA 44% above the guidance midpoint and revenue 2% above midpoint .
- Demand-side scale: redeemers +19% YoY to 18.2M, supported by Instacart launch (Q4’24) and offers to a majority of DoorDash customers (Q2’25) .
- Strategic progress: launched LiveLift and announced Circana third-party lift studies; CEO: “first step in fundamentally shifting how promotions are perceived… allowing us to capture a larger percentage of CPG marketing spend” .
What Went Wrong
- Top-line and mix pressure: revenue −16% YoY; direct‑to‑consumer redemption revenue −31% YoY; redemptions per redeemer −28% YoY, reflecting offer mix and lower frequency on third‑party channels .
- Margin compression: non‑GAAP gross margin ~80%, down ~800 bps YoY driven by higher publisher-related costs (partly offset by a 30 bps sequential uptick) .
- Macro headwinds: low consumer sentiment, SNAP disruption, tariff uncertainty prompting large CPGs to “wait‑and‑see” on discretionary promotions; higher measurement rigor demanded before budget unlocks .

Financial Results

Metric	Q1 2025	Q2 2025	Q3 2025
Revenue ($USD Millions)	$84.6	$86.0	$83.3
Adjusted EBITDA ($USD Millions)	$14.7	$17.9	$16.6
Adjusted EBITDA Margin (%)	17%	21%	20%
GAAP Diluted EPS ($)	N/A	N/A	$0.05
Adjusted Diluted EPS ($)	$0.36	$0.49	$0.56
Redeemers (Millions)	17.1	17.3	18.2

Q3 vs Estimates (S&P Global consensus)

Metric	Q3 2025 Estimate	Q3 2025 Actual	Surprise
Revenue ($USD)	$82.14M*	$83.26M	+$1.12M / +1.4%
Primary EPS ($)	$0.00*	$0.56 (adjusted)	+$0.56

Values retrieved from S&P Global.*

Segment Revenue Mix

Segment	Q3 2024	Q2 2025	Q3 2025
Direct-to-Consumer Redemption Revenue ($M)	$33.1	$24.7	$22.8
Direct-to-Consumer Ad & Other ($M)	$14.1	$12.8	$11.2
Total Direct-to-Consumer ($M)	$47.3	$37.5 (sum)	$34.0
Third-Party Redemption Revenue ($M)	$51.3	$48.6	$49.3
Total Revenue ($M)	$98.6	$86.0	$83.3

KPIs

KPI	Q1 2025	Q2 2025	Q3 2025
Total Redemptions (Millions)	N/A	N/A	82.8
Total Redeemers (Millions)	17.1	17.3	18.2
Redemptions per Redeemer	4.8	4.6	4.6
Redemption Revenue per Redemption ($)	$0.89	$0.91	$0.87

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	Q4 2025	—	$80–$85M	New
Adjusted EBITDA	Q4 2025	—	$9–$12M (~13% margin midpoint)	New

Note: Q3’25 prior guidance issued in August was $79–$84M revenue and $9.5–$13.5M adjusted EBITDA; actuals were $83.3M and $16.6M, respectively .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 & Q2)	Current Period (Q3)	Trend
Performance marketing transformation (CPID → LiveLift)	Early pilots with large CPGs; strong enthusiasm; heavy R&D and sales reorg; need for automation and measurement; 6+ pilots lined up	LiveLift launched; 20 pilots targeted by year-end; 83% re-up rate among completed pilots; shifting nomenclature to LiveLift; broader sales enablement	Accelerating adoption; scaling GTM
Third-party measurement	Working toward independent lift studies; initial third-party validation better than internal results	Formal Circana partnership; plans to fund “several million dollars” of lift studies in 2026 to validate incrementality	Increasing investment/credibility
Macro headwinds (tariffs, SNAP, consumer sentiment)	Tariffs and cautious budgets impacting supply; wait-and-see among clients	Macro “noisy” with tariffs, weak sentiment, SNAP disruption; clients cautious on discretionary promotions	Persistent headwind near term
Publisher expansion & contribution	Instacart/Family Dollar additions; Walmart identification improvements; majority DoorDash rollout in Q2	Majority DoorDash live; strong redeemer growth; alc‑bev added in ~13 states; DoorDash nearing full coverage	Demand-side strength; mix shift
Sales execution & reorg	Ongoing reorg to vertical model; turnover; need GTM process improvements	Reorg completed; VP roles filled; improved enablement; Q4 to be fully staffed with higher seasonal marketing spend	Execution stabilizing; near-term OpEx up
AI/automation	Moving toward ML-driven projections/optimization; building self-service tools	AI used for pre-campaign/in-flight projections; agentic tooling reduced UPC setup time ~50%	Progressing implementation

Management Commentary

“We’re pleased to report revenue in the upper half of the guidance range… while delivering adjusted EBITDA well above the top end of the range.” — Bryan Leach, CEO
“Our partnership with Circana will enable CPG brands to compare the purchase behavior of consumers who are exposed to an Ibotta offer versus those who are not… helping address the concern that we are grading our own homework.” — Bryan Leach
“We delivered Q3 adjusted EBITDA of $16.6 million… adjusted net income of $16.3 million… We ended the quarter with $223.3 million of cash and cash equivalents.” — Matt Puckett, CFO
“We currently expect revenue in the range of $80–$85 million… and Q4 adjusted EBITDA in the range of $9–$12 million… we expect as much as a low double-digit decline in revenue from Q4’25 to Q1’26 followed by sequential increases each quarter thereafter.” — Matt Puckett
“Subsequent to quarter-end, [we] announced the launch of LiveLift™, an enhanced solution that helps CPG brands measure and optimize their campaigns while live.” — Press Release

Q&A Highlights

LiveLift adoption and timeline: On track for ~20 pilots by year-end; among completed pilots, 83% have re-upped; full sales force to sell LiveLift in Q1’26; timeline from outreach to scaled budgets can be up to ~12 months, but strong performance can accelerate decisions .
Macro commentary: Tariffs, low consumer sentiment, and SNAP disruptions are creating a cautious environment with clients pausing discretionary promo spend; rigorous ROI measurement is increasingly required .
AI integration: ML models drive pre-campaign and in‑flight projections; internal agent reduced campaign setup workload ~50% by automating UPC selection .
Publisher rollout: DoorDash near universal rollout; Instacart and alc‑bev category added where permitted; both channels contributed to YoY redeemer growth .
2026 setup: Expect normalized seasonality (Q4→Q1 down low double-digit %, then sequential growth), continued investment in third-party lift studies, and scaling LiveLift automation and GTM .

Estimates Context

Q3’25 revenue beat S&P Global consensus: $83.26M actual vs $82.14M estimate (+1.4%); Primary EPS (adjusted) $0.56 actual vs $0.00 estimate* . Values retrieved from S&P Global.*
Q4’25 consensus calls for revenue ~$83.23M; Primary EPS −$0.02*; company guides $80–$85M revenue and $9–$12M adjusted EBITDA, implying a margin lower than Q3 as seasonal marketing and full staffing step up expenses . Values retrieved from S&P Global.*

Where estimates are noted with an asterisk (*), values retrieved from S&P Global.

Key Takeaways for Investors

Execution stabilized: Despite −16% YoY revenue, IBTA delivered a 20% adjusted EBITDA margin and exceeded EBITDA guidance; redeemer growth and publisher scale support medium‑term operating leverage once LiveLift drives offer supply .
Near-term headwinds persist: Q4 guide implies continued YoY declines and lower margins due to seasonality and OpEx; macro caution and mix shift to third‑party publishers constrain revenue per redeemer .
LiveLift is the fulcrum: Early pilot traction (including re‑ups) plus Circana validation should unlock budgets through 2026; expect a lag from pilots to scaled spend as third‑party studies and budgeting cycles complete .
Measurement spend is strategic: Management plans “several million dollars” of third‑party lift studies in 2026 to cement credibility, a transitory investment typical for new ad platforms .
Capital allocation supportive: $223.3M cash, $10.6M FCF in Q3, and $89.9M remaining repurchase authorization after buying back 1.4M shares for $38.7M; provides flexibility to fund transformation and return capital .
Watch KPIs: Signs to monitor include growth in LiveLift pilots and conversions to always‑on campaigns, redeemers and redemptions per redeemer trends, and third‑party measurement adoption pace .
Trading setup: Into Q4, the narrative hinges on execution of LiveLift pilots, evidence of budget unlocks, and validation via Circana; surprises on faster conversion of pilots or publisher additions could re‑rate top‑line trajectory .

Ibotta, Inc. (IBTA)·Q3 2025 Earnings Summary