February 23, 2022

Riskified Ltd. (NYSE: RSKD) (the “Company”), a risk management platform enabling frictionless eCommerce, today announced financial results for the three and twelve months ended December 31, 2021.

“Continued organic growth and expansion into new segments of eCommerce volume within our existing customer base, the addition of several new logos, as well as continued enhancement of our highly specialized machine learning platform drove meaningful financial benefits both for Riskified and our merchants over the past year,” said Eido Gal, Co-Founder and Chief Executive Officer of Riskified. “Our north star has always been to create outsized value for our customers, and we believe our 99% gross annual dollar retention in 2021 is a clear validation that we have been successful in delivering that value. As we look ahead, we are excited to continue to land and expand with the world’s largest online retailers by holistically solving their most complex technological problems.”

Full Year and Q4 2021 Business Highlights

  • Expanding the reach of core chargeback guarantee offering: Riskified delivered multiple new use cases and product improvements throughout 2021, including the recent expansion of chargeback guarantees to support Automated Clearing House (“ACH”) payments. Riskified can now guarantee a broader range of payment types in addition to credit cards, debit cards, and PayPal. This expanded functionality assists merchants accepting ACH payments to realize more profitable revenue while also delivering instant settlement times to their customers. Q4 represented the first quarter in which the Company processed meaningful ACH volumes.
  • Adding several of the world’s pre-eminent online retailers to the platform: Within its emerging verticals, Riskified added Binance, one of the world’s leading blockchain ecosystem and cryptocurrency infrastructure providers, as well as a global remittance and payments company with more than $5 billion in annual revenues, among others. Within its more established verticals, Riskified added Saks OFF 5TH, the premier luxury off-price destination, one of the world’s five largest omni-channel retailers, and one of the world’s five largest travel retailers, among others.
  • Accelerating go-to-market motion via new partner-driven sales efforts: Riskified has a growing number of partners embedding the core chargeback guarantee offering directly into their respective products. This is an exciting new sales channel that should help reach target customers even faster via partners including payment gateways, enterprise focused eCommerce platforms, and one-click checkout products.
  • Executing on the product roadmap: Riskified expanded its Policy Protect offering to support item-not-received and refund claims. Policy Protect is used to block abusive customers and it is now screening billions of dollars worth of GMV annually. Riskified also expanded its ability to dispute chargebacks on its merchants’ behalf, even when those chargebacks are not guaranteed by Riskified.

Q4 2021 Financial Performance Highlights

The following table summarizes our consolidated financial results for the three and twelve months ended December 31, 2021 and 2020, in thousands except where indicated:

Three Months Ended December 31,

Year Ended December 31,

2021

2020

2021

2020

(unaudited)

(audited)

Gross merchandise volume (“GMV”) in millions(1)

$

27,795

$

22,587

$

89,124

$

63,437

Increase in GMV year over year

23

%

65

%

40

%

60

%

Revenue

$

69,833

$

57,049

$

229,141

$

169,740

Increase in revenues year over year

22

%

46

%

35

%

30

%

Gross profit

$

36,758

$

33,193

$

122,971

$

92,824

Gross profit margin

53

%

58

%

54

%

55

%

Operating profit (loss)

$

(22,809

)

$

7,418

$

(55,398

)

$

(6,808

)

Net profit (loss)

$

(23,057

)

$

4,348

$

(178,885

)

$

(11,347

)

Adjusted EBITDA(1)

$

(6,951

)

$

8,502

$

(19,451

)

$

2,497

“We are pleased with the team’s overall focus and operational execution to end the year on strong footing. We are optimistic that we can carry this momentum into 2022, particularly amidst short-term influences from slower e-commerce activity globally in the wake of the pandemic, and the tail end of PSD2 implementation across the EU,” said Aglika Dotcheva, Chief Financial Officer of Riskified. “We expect our growth to reaccelerate in the second half of the year as we move beyond these temporary factors. Looking beyond, our long-term growth prospects remain highly compelling, and we are confident that investments across our core platform, new products, and more geographies will help to maximize our large market opportunity.”

Financial Outlook

For the year ending December 31, 2022, Riskified expects:

  • Revenue between $254 million and $257 million
  • Adjusted EBITDA(2) between negative $69 million and $66 million

_______________

(1) GMV is a key performance indicator and Adjusted EBITDA is a non-GAAP metric. See “Key Performance Indicators and Non-GAAP Metrics” for additional information regarding this non-GAAP metric and “Reconciliation of GAAP to Non-GAAP Metrics” for a reconciliation of this non-GAAP metric to the most directly comparable GAAP metric.

(2) We are not able to provide a reconciliation of Adjusted EBITDA guidance for the fiscal year ending December 31, 2022 to net profit (loss) because certain items that are excluded from Adjusted EBITDA but included in net profit (loss), its most directly comparable GAAP financial measure, cannot be predicted on a forward-looking basis without unreasonable effort or are not in our control. In particular, we are unable to forecast the timing or magnitude of share- based compensation expense and foreign currency transaction gains or losses as applicable without unreasonable efforts, and these items could significantly impact, either individually or in the aggregate, GAAP metrics in the future.