Sign in

You're signed outSign in or to get full access.

CS

Clear Secure, Inc. (YOU)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 revenue of $229.2M (+15.5% YoY) and total bookings of $260.1M (+14.3% YoY) both exceeded Q3 guidance; operating income reached $52.6M (23.0% margin) and Adjusted EBITDA was $70.1M (30.6% margin) .
  • Management raised full-year 2025 free cash flow guidance to at least $320M (from at least $310M) and reaffirmed FY Adjusted EBITDA margin expansion; Q4 guidance implies accelerating bookings growth (Revenue $234–$237M; Bookings $265–$270M) .
  • KPIs showed continued expansion: Active CLEAR+ Members 7.683M (+7.5% YoY), cumulative enrollments 35.751M (+35.1% YoY), and eGates launched in 10 airports with rollout to ~30 by year-end and nationwide in 2026, supporting throughput/NPS improvements .
  • S&P Global consensus for Q3 was Revenue $224.8M* and Primary EPS $0.312*; actual revenue beat, while GAAP diluted EPS printed $0.29, versus SPGI Primary EPS actual $0.368* (different EPS basis); Q4 Street revenue consensus is $235.8M*, broadly aligned with company guidance [functions.GetEstimates]*.
  • Near-term catalysts: accelerating bookings into Q4, eGate rollout, international Clear Plus enrollment (>40 countries), and CLEAR1 enterprise momentum (record quarter) .

What Went Well and What Went Wrong

What Went Well

  • Exceeded Q3 guidance on revenue and bookings; delivered margin expansion across P&L (Adjusted EBITDA margin 30.6%, +610 bps YoY) .
  • Strong product traction: eGates “magical” experience (≈5s verification, ≈30s to screening) and improved lane experience/NPS; rollout to ~30 airports by year-end, nationwide in 2026 .
  • CLEAR1 enterprise momentum: record bookings quarter; deeper healthcare integration (CMS pledge; Epic MyChart turnkey), workforce identity lifecycle expansion and cross-sell .

Quotes:

  • “Members verify in approximately five seconds and move directly into physical screening in 30 seconds… drive meaningful improvements in throughput, lane experience scores, and NPS” .
  • “Clear One delivered its strongest quarter yet with a record number of enterprise customers signed” .

What Went Wrong

  • Gross Dollar Retention fell to 86.9%, down 40 bps sequentially as 2023 price increases continue to normalize impact; management expects moderation to continue .
  • Q3 free cash flow was negative ($53.5M) and operating cash flow was negative ($47.3M) due to ~$229M annual payment to the credit card partner .
  • Ongoing operational headwinds around broader airport experience and government/TSA staffing noise, despite traffic trending up; CLEAR is focused on mitigating experience issues .

Financial Results

Income Statement and Margins (USD unless noted)

MetricQ1 2025Q2 2025Q3 2025
Revenue ($M)$211.4 $219.5 $229.2
Operating Income ($M)$37.4 $42.6 $52.6
Operating Margin (%)17.7% 19.4% 23.0%
Net Income ($M)$38.6 $37.9 $45.1
Net Income Margin (%)18.0% 17.3% 19.7%
Diluted EPS ($)$0.26 $0.26 $0.29
Adjusted EBITDA ($M)$52.178 $60.060 $70.063
Adjusted EBITDA Margin (%)25.0% 27.4% 30.6%

Results vs Wall Street Consensus (S&P Global)

MetricQ3 2025 ActualQ3 2025 ConsensusSurprise
Revenue ($M)$229.193 $224.804*+$4.389M / +2.0%*
Primary EPS ($)$0.29 (GAAP diluted) ; $0.368* (SPGI Primary EPS actual)$0.312*GAAP diluted vs Street: -$0.022*; SPGI Primary EPS vs Street: +$0.056*
EBITDA ($M)$70.063 (Adj. EBITDA) ; $56.628* (SPGI EBITDA actual)$59.418*SPGI EBITDA miss: -$2.79M*

Values marked with * retrieved from S&P Global.

KPIs and Operating Metrics

KPIQ1 2025Q2 2025Q3 2025
Total Bookings ($M)$207.2 $222.9 $260.1
Active CLEAR+ Members (000s)7,415 7,626 7,683
Total Cumulative Enrollments (000s)31,215 33,472 35,751
Total Cumulative Platform Uses (000s)248,895 264,830 280,329
Annual CLEAR+ Gross Dollar Retention (%)87.1% 87.3% 86.9%
Annual CLEAR+ Member Usage (x)7.1x 7.0x 7.0x

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue ($M)Q4 2025N/A$234–$237 New
Total Bookings ($M)Q4 2025N/A$265–$270 New
Free Cash Flow ($M)FY 2025At least $310 At least $320 Raised
Adjusted EBITDA MarginFY 2025Expansion vs FY 2024 reaffirmed Expansion reaffirmed Maintained
GAAP Tax Rate (%)FY 202517–20 Not updated in Q3 materialsN/A
Dividend per share ($)Q4 declaration$0.125 (Q3 regular) $0.125 payable Dec 24, 2025 Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2)Current Period (Q3)Trend
eGates rollout & automationPlanning/launch progress, ENVE pods for throughput “Magical” experience; 10 airports now, ~30 by YE25, nationwide in 2026; improved lane/NPS Accelerating deployment; improving experience and efficiency
International Clear PlusInitial expansion (UK/CA/AU/NZ) >40 countries enabled; early enrollments before marketing Rapid TAM expansion
CLEAR1 enterpriseRecord deals momentum Record bookings quarter; CMS pledge penetration; Epic MyChart integration; workforce lifecycle use cases Scaling; deeper healthcare distribution
Pricing & ARPM levers2023 price increases detailed in Q1 letter Multiple levers: cadence of price increases, closing partner discounts, add-on services (Concierge) Supports bookings growth; retention stable
TSA PreCheck bundlingOngoing cross-sell “Significant success”; continued bundling contribution Steady contributor
Macro: traffic/TSA staffingTravel growth commentary Traffic up ~4% in Oct despite shutdown; CLEAR mitigates experience challenges Traffic tailwinds; experience support
Concierge serviceLaunched in July; early rollout 23 airports; repeat usage; ramp awareness Expanding footprint
PartnershipsAmex Platinum embedded benefit Reaffirmed value; renewal considerations into next year Strategic channel continuity

Management Commentary

  • CEO framing: “Identity is the foundation of trust… Cybercriminals aren’t breaking in; they’re logging in” underscoring platform relevance amid AI/cyber trends .
  • Travel experience: “Members verify in approximately five seconds and move directly into physical screening in 30 seconds… the experience is magical” (eGates scaling) .
  • Enterprise: “Clear One delivered its strongest quarter yet with a record number of enterprise customers signed” (CMS pledge, Epic integration, workforce lifecycle) .
  • Efficiency to hospitality: eGates free up ambassadors for higher-value services (Concierge), aiming for margin and experience gains .

Q&A Highlights

  • Bookings upside drivers: mix of Clear Plus experience improvements (mobile one-step, eGates, international) and CLEAR1 enterprise traction; no breakout by product in guidance .
  • Gross Dollar Retention: 86.9% sequential decline expected from 2023 pricing normalizing; retention patterns stable post Jul 1 pricing .
  • Macros/TSA: Despite staffing news, traffic trending higher; CLEAR supports stakeholders to improve experience .
  • Airport economics/margins: Success-based partnerships; eGates drive efficiency; Concierge opens high-margin revenue opportunities .
  • International marketing: Early enrollments pre-marketing; plan to add strategic partnerships; World Cup expected to be a demand catalyst .
  • Concierge adoption: 23 airports; strong repeat usage; focus on awareness expansion .
  • Amex partnership: Embedded benefit in Platinum refresh; renewal to reflect value delivered .

Estimates Context

  • Revenue: Q3 actual $229.193M vs consensus $224.804M* → beat; Q4 consensus $235.835M* broadly in-line with guidance $234–$237M [functions.GetEstimates]*.
  • EPS: Company reported GAAP diluted EPS $0.29 ; S&P Global Primary EPS consensus $0.312* and SPGI Primary EPS actual $0.368*, reflecting differing EPS bases; on a GAAP diluted basis this prints below Street Primary EPS, while SPGI’s Primary EPS “actual” shows a beat [functions.GetEstimates]*.
  • EBITDA: Company reported Adjusted EBITDA $70.063M ; SPGI EBITDA consensus $59.418M* and SPGI EBITDA actual $56.628M* (different definition vs Adjusted EBITDA), indicating a miss on SPGI EBITDA basis [functions.GetEstimates]*.

Values marked with * retrieved from S&P Global.

Key Takeaways for Investors

  • Bookings growth is accelerating and guided to continue in Q4, supported by pricing levers, eGate-driven experience improvements, and international enrollment expansion .
  • CLEAR1 enterprise momentum plus healthcare ecosystem integrations offer diversification beyond travel and should support durable bookings growth into 2026 .
  • Margin expansion is broad-based; automation (eGates) and ambassador redeployment to hospitality services (Concierge) are structural levers for operating leverage .
  • Free cash flow raised to ≥$320M for FY 2025 despite incremental eGate CapEx and seasonal partner payment headwind; expect stronger FCF cadence outside the annual payment quarter .
  • Near-term trading setup: positive revenue beat vs Street, aligned Q4 revenue guide, and FCF raise are supportive; clarity around Amex partnership renewal and continued eGate rollout could be incremental catalysts .
  • Watch GDR stabilization as pricing impacts normalize; management sees stable retention patterns post Jul 1 pricing .
  • International (>40 countries enabled) and major events (World Cup) provide incremental TAM tailwinds for Clear Plus demand .

Appendix: Additional Data

Balance Sheet and Cash Flow Highlights (Q3)

  • Cash and marketable securities: Cash $75.766M; marketable securities $454.876M; total cash + securities ≈$530.6M at 9/30/25 .
  • Operating cash flow (Q3): $(47.299)M; Free Cash Flow $(53.470)M due to ~$229M annual credit card partner payment .
  • Dividend: Quarterly cash dividend declared $0.125 per share, payable Dec 24, 2025 (record date Dec 10, 2025) .