CLEAR grows revenue while partnership payments drain cash
CLEAR reported higher third-quarter revenue and profit as its membership expanded. Operating cash flow was negative after the identity company settled accrued partnership liabilities. It also distributed cash to shareholders through dividends and buybacks. Management raised the lower end of its annual free cash flow outlook alongside the quarterly results.
Economics & Markets··Morning
Revenue growth lifts quarterly profit
Identity verification company CLEAR increased third-quarter revenue by 27.8 per cent. Revenue for the period ended 30 September reached 292.9 million dollars, while diluted earnings per share were 0.52 dollars. The growth accompanied an expansion of its membership base and the airport network used by its subscription identity service.[1], [2]
Operating income was 82.9 million dollars, giving a margin of 28.3 per cent. Net income reached 75.3 million dollars and the net margin was 25.7 per cent, an increase of 600 basis points from a year earlier. Adjusted earnings before interest, tax, depreciation and amortisation were 103.9 million dollars, equivalent to a margin of 35.5 per cent.[1]
Accrued partnership liabilities are paid
CLEAR reported an operating cash outflow of 98.6 million dollars and free cash outflow of 103.8 million dollars. The company linked both figures to settlement of approximately 315 million dollars in accrued partnership liabilities. Payment of those obligations took cash out of the business during a quarter in which it reported positive accounting earnings.[1]
Shareholder returns during the quarter totalled 191.4 million dollars: 20.5 million dollars in dividends and other distributions, and 170.9 million dollars in buybacks. The board added 175 million dollars to repurchase authorisation, leaving 254.4 million dollars available. It also declared a dividend of 0.15 dollars per share, payable on 24 December to shareholders on the register on 10 December.[1]
Membership and bookings expand
Total membership grew by 30.7 per cent to 46.7 million, while active CLEAR+ members increased by 14.5 per cent to 8.5 million. The subscription service’s active count includes family accounts, trials and members in a billing grace period. The company operated at 62 airports at quarter end.[1]
Total bookings, defined as revenue plus the change in deferred revenue, increased by 24.4 per cent to 323.5 million dollars. Management raised the floor of annual free cash flow guidance from 480 million dollars to 490 million dollars. Its fourth-quarter forecasts were 299–302 million dollars for revenue and 335–340 million dollars for bookings.[1]
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