Cardlytics (CDLX) Q2 2024 earnings summary

Executive summary

• COO Amit Gupta appointed as CEO effective August 16, 2024, succeeding Karim Temsamani.

• Revenue for Q2 2024 was $69.6 million, down 9% year-over-year, with billings up 1% to $110.4 million, reflecting strong advertiser demand but offset by higher consumer incentives.

• Net loss narrowed to $4.3 million from $23.5 million in Q2 2023, aided by a $13.0 million gain on debt extinguishment and a $5.8 million gain from contingent consideration settlement.

• Monthly active users (MAUs) grew 3% year-over-year to 165.5 million, but ARPU declined 13% to $0.42 due to increased consumer incentives.

• The company is in the early stages of a significant transformation, focusing on technology modernization and operational improvements.

Financial highlights

• Q2 2024 billings were $110.4 million, up 2% year-over-year excluding the former Entertainment subsidiary.

• Revenue was $69.6 million, down 9% year-over-year, due to under-delivery of advertiser budgets and higher consumer incentives.

• Adjusted contribution was $36.4 million, nearly flat year-over-year, with a margin of 52%.

• Adjusted EBITDA improved to a loss of $2.3 million from a $4.1 million loss in Q2 2023.

• Consumer incentives increased 25% to $40.8 million, reflecting higher engagement.

• Operating cash flow was $4.4 million; free cash flow was -$0.4 million.

• Ended Q2 with $71.2 million in cash and $60 million in unused credit.

Outlook and guidance

• Q3 2024 guidance: billings of $100–$106 million, revenue of $56–$63 million, adjusted contribution of $32–$35 million, and adjusted EBITDA of -$6 to -$3.5 million.

• No expectation for double-digit billings growth or positive operating cash flow for full year 2024.

• 2025 expected to see performance acceleration, double-digit billings growth, and positive free cash flow as operational execution improves and new partnerships scale.

• Year-over-year declines expected in all major metrics for Q3, reflecting ongoing transition and market headwinds.