Cardlytics, Inc.

Previous wording

This Quarterly Report on Form 10-Q contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. These statements are often identified by the use of words such as "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "project," "will," "would" or the negative or plural of these words or similar expressions or variations, and such forward-looking statements include, but are not limited to, statements with respect to our business strategy, plans and objectives for future operations, including our expectations regarding our expenses; continued enhancements of our platform and new product offerings; our future financial and business performance; and our ability to continue to add new FI partners, merchant data partners and marketers and maintain our relationships with existing FI partners, merchant data partners and marketers. The events described in these forward-looking statements are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those identified herein, and those discussed in the section titled "Risk Factors," set forth in Part II, Item 1A of this Quarterly Report on Form 10-Q and in our other SEC filings. You should not rely upon forward-looking statements as predictions of future events. Furthermore, such forward-looking statements speak only as of the date of this report. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements.

Current wording

This Quarterly Report on Form 10-Q contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. These statements are often identified by the use of words such as "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "project," "will," "would" or the negative or plural of these words or similar expressions or variations, and such forward-looking statements include, but are not limited to, statements with respect to our business strategy, plans and objectives for future operations, including our expectations regarding our expenses; continued enhancements of our platform and new product offerings; our future financial and business performance; and our ability to continue to add new FI partners and marketers and maintain our relationships with existing FI partners and marketers. The events described in these forward-looking statements are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those identified herein, and those discussed in the section titled "Risk Factors," set forth in Part II, Item 1A of this Quarterly Report on Form 10-Q and in our other SEC filings. You should not rely upon forward-looking statements as predictions of future events. Furthermore, such forward-looking statements speak only as of the date of this report. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements.

Previous wording

We operate a commerce media platform that is designed to make commerce smarter and rewarding for everyone. At the core of our commerce media platform is the financial media network that we run within our partners' digital channels, which includes online channels and mobile applications (the "Cardlytics platform"). Additionally we operate an identity resolution platform that utilizes point-of-sale ("POS") data, including product-level purchase data, to enable advertisers to conduct analytics and targeted loyalty marketing and also measure the impact of their marketing (the "Bridg platform"). The partners for the Cardlytics platform are predominantly financial institutions ("FI partners") that provide us with access to their anonymized purchase data and digital banking customers. The partners for the Bridg platform are predominantly merchants ("merchant data partners") that provide us with access to their POS data, including product-level purchase data. By applying advanced analytics to the purchase data we receive, we make it actionable, helping marketers reach potential customers at scale and measure the true sales impact of their marketing spend. We have strong relationships with leading marketers across a variety of industries, including everyday spend, specialty retail, restaurant, travel and entertainment.

Current wording

We operate a commerce media platform that is designed to make commerce smarter and rewarding for everyone. At the core of our commerce media platform is the financial media network that we run within our partners' digital channels, which includes online and mobile applications (the "Cardlytics platform"). The partners for the Cardlytics platform are predominantly financial institutions ("FI partners") that provide us with access to their anonymized purchase data and digital banking customers. By applying advanced analytics to the purchase data we receive, we make it actionable, helping marketers reach potential buyers at scale and measure the true sales impact of their marketing spend. We have strong relationships with leading marketers across a variety of industries, including everyday spend, specialty retail, restaurant, travel and entertainment.

Previous wording

Adjusted EBITDA represents our Net Loss before interest expense, net; depreciation and amortization; stock-based compensation expense; foreign currency loss (gain); gain on debt extinguishment; acquisition, integration and divestiture costs; loss (gain) on disposal or divestiture; change in contingent consideration; reduction in force; and, in applicable periods, certain other income and expense items, such as impairment of goodwill and intangible assets; income tax benefit; and deferred implementation costs. We do not consider these excluded items to be indicative of our core operating performance. Of these items depreciation and amortization expense, stock-based compensation expense, impairment of goodwill and intangible assets and foreign currency loss (gain) are non-cash impacting. Notably, any impacts related to minimum Partner Share commitments in connection with agreements with certain partners are not added back to net loss in order to calculate Adjusted EBITDA.

Current wording

Adjusted EBITDA represents our Net Loss before interest expense, net; depreciation and amortization; stock-based compensation expense continuing operations; foreign currency loss (gain); loss on investment; gain on divestiture; change in contingent consideration and Income (loss) from discontinued operations and, in applicable periods, certain other income and expense items, such as impairment of goodwill and intangible assets; income tax benefit; gain on debt extinguishment; reduction in force and deferred implementation costs. We do not consider these excluded items to be indicative of our core operating performance. Of these items depreciation and amortization expense, stock-based compensation expense, impairment of goodwill and intangible assets and foreign currency loss (gain) are non-cash impacting. Notably, any impacts related to minimum Partner Share commitments in connection with agreements with certain partners are not added back to net loss in order to calculate Adjusted EBITDA.

Previous wording

We define Adjusted Net Loss as our Net Loss before stock-based compensation expense; foreign currency loss (gain); gain on debt extinguishment; acquisition, integration and divestiture costs; amortization of acquired intangibles; loss (gain) on disposal or divestiture; change in contingent consideration; reduction in force; and, in applicable periods, certain other income and expense items, such as impairment of goodwill and intangible assets and income tax benefit. We define Adjusted Net Loss per share as Adjusted Net Loss divided by our weighted-average common shares outstanding, diluted.

Current wording

We define Adjusted Net Loss as our Net Loss before stock-based compensation expense continuing operations; foreign currency loss (gain); loss on investment; gain on divestiture; change in contingent consideration; and Income (loss) from discontinued operations and, in applicable periods, certain other income and expense items, such as impairment of goodwill, gain on debt extinguishment and intangible assets, reduction in force and income tax benefit. We define Adjusted Net Loss per share as Adjusted Net Loss divided by our weighted-average common shares outstanding, diluted.

Previous wording

We define Free Cash Flow as net cash provided by (used in) operating activities, plus acquisition of property and equipment and capitalized software development costs and, in applicable periods, acquisition of patents. We believe free cash flow is useful to measure the funds generated in a given period that are available for distribution or to sustain the business. We believe this supplemental information enhances stockholders' ability to evaluate our performance.

Current wording

We define Free Cash Flow as net cash used in operating activities, plus acquisition of property and equipment and capitalized software development costs and, in applicable periods, acquisition of patents. We believe free cash flow is useful to measure the funds generated in a given period that are available for distribution or to sustain the business. We believe this supplemental information enhances stockholders' ability to evaluate our performance.

Previous wording

During the three months ended September 30, 2025, Billings decreased by$22.8 million compared to the three months ended September 30, 2024, primarily driven by a $24.8 million decrease in net sales to existing marketers, partially offset by an increase of $2.0 million in sales to new marketers.

Current wording

During the three months ended March 31, 2026, Billings decreased by $34.0 million compared to the three months ended March 31, 2025, primarily driven by a $35.5 million decrease in net sales to existing marketers, partially offset by an increase of $1.5 million in sales to new marketers.

Previous wording

(1)Stock-based compensation expense recognized in consolidated delivery costs totaled $0.4 million and $0.7 million during the three months ended September 30, 2025 and 2024, respectively. Stock-based compensation expense recognized in consolidated delivery costs totaled $1.4 million and $2.0 million during the nine months ended September 30, 2025 and 2024, respectively.

Current wording

(2)Stock-based compensation expense recognized in consolidated delivery costs totaled $0.3 million and $0.5 million during the three months ended March 31, 2026 and 2025, respectively.

Previous wording

We sell our Cardlytics platform solution by entering into agreements directly with marketers or their marketing agencies, generally through the execution of insertion orders. The insertion orders state the terms of the arrangement, the negotiated fee, payment terms and the fixed period of time of the campaign. We generally invoice marketers monthly based on the qualifying purchases of our partners' customers as reported by our partners during the month or based on the engagement of our partners' customers with our offers during the month. We report our Revenue net of Consumer Incentives and gross of Partner Share and other third-party costs. The Bridg platform generates Revenue through the sale of subscriptions to our cloud-based customer-data platform and the delivery of professional services, such as implementation, onboarding and technical support in connection with each subscription. We recognize subscription Revenue on a ratable basis over the contract term beginning on the date that our service is made available to the customer.

Current wording

We sell our Cardlytics platform solution by entering into agreements directly with marketers or their marketing agencies, generally through the execution of insertion orders. The insertion orders state the terms of the arrangement, the negotiated fee, payment terms and the fixed period of time of the campaign. We generally invoice marketers monthly based on the qualifying purchases of our partners' customers as reported by our partners during the month or based on the engagement of our partners' customers with our offers during the month. We report our Revenue net of Consumer Incentives and gross of Partner Share and other third-party costs. The Bridg platform generated Revenue through the sale of subscriptions to our cloud-based customer-data platform and the delivery of professional services, such as implementation, onboarding and technical support in connection with each subscription. We recognize subscription Revenue on a ratable basis over the contract term beginning on the date that our service is made available to the customer.

Previous wording

Acquisition costs primarily represent diligence efforts, legal and advisory costs, broker fees and insurance premiums. Integration costs primarily represent integration-related employee compensation, advisory costs and travel costs. Divestiture costs primarily represent legal and other professional fees.

Current wording

Divestiture costs primarily represent legal and other professional fees.

Previous wording

Loss (gain) on disposal or divestiture consists primarily of the gain recorded in connection with the decommission of the Dosh app, a consumer facing cashback mobile application operated by Dosh Holdings LLC on February 28, 2025. In connection with the decommission, we recorded a loss (gain) on disposal or divestiture due to the derecognition of the wallet liability associated with the Dosh app.

Current wording

Loss on Investment consists primarily of the gain recorded in connection with the decommission of the Dosh app, a consumer facing cashback mobile application operated by Dosh Holdings LLC on February 28, 2025. In connection with the decommission, we recorded a loss on investment due to the derecognition of the wallet liability associated with the Dosh app.

Previous wording

Comparison of Three and Nine Months Ended September 30, 2025 and 2024

Current wording

Comparison of Three Months Ended March 31, 2026 and 2025

Previous wording

The $15.0 million decrease in Revenue during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 was comprised of a $22.8 million decrease in Billings and a $7.7 million decrease in Consumer Incentives. Consumer Incentives decreased at a lower rate than Billings during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 primarily due to strategic decisions to drive incremental performance for our advertisers as well as optimization of our network.

Current wording

The $22.1 million decrease in Revenue during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 was comprised of a $34.0 million decrease in Billings and a $11.9 million decrease in Consumer Incentives. Consumer Incentives decreased at a lower rate than Billings during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to strategic decisions to drive incremental performance for our advertisers as well as optimization of our network.

Previous wording

Partner Share and other third-party costs decreased by$8.7 million during the three months ended September 30, 2025 compared to the three months ended September 30, 2024, primarily drivenby lower top line billings and changes in Partner mix.

Current wording

Partner Share and other third-party costs decreased by$14.5 million during the three months ended March 31, 2026 compared to the three months ended March 31, 2025, primarily drivenby lower top line billings and changes in Partner mix.

Previous wording

Total delivery costs decreased by $2.1 million during the three months ended September 30, 2025 compared to the three months ended September 30, 2024. Delivery costs excluding stock-based compensation expense decreased by $1.9 million during the three months ended September 30, 2025 compared to the three months ended September 30, 2024, driven by a $1.2 million decrease in staff expense and a $0.7 million decrease in data storage expense. The decrease in staff expense includes a $0.5 million benefit associated with the approval of the second quarter 2021 employee retention tax credit.

Current wording

Total delivery costs decreased by $3.2 million during the three months ended March 31, 2026 compared to the three months ended March 31, 2025. Delivery costs excluding stock-based compensation decreased by $3.0 million during the three months ended March 31, 2026 compared to the three months ended March 31, 2025, driven by a decrease of $1.3 million in staff expense and $1.7 million in data storage expense.

Previous wording

Total sales and marketing expense decreased by $5.3 million during the three months ended September 30, 2025 compared to the three months ended September 30, 2024. Sales and marketing expenses excluding the impact of stock-based compensation expense decreased by $3.8 million during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 primarily due to a$3.6 million decrease in staff expense and a$0.2 million decrease in marketing events. The decrease in staff expense includes a $1.1 million benefit associated with the approval of the second quarter 2021 employee retention tax credit.

Current wording

Total sales and marketing expense decreased by $3.6 million during the three months ended March 31, 2026 compared to the three months ended March 31, 2025. Sales and marketing expenses excluding stock-based compensation decreased by$2.7 million during thethree months ended March 31, 2026 compared to thethree months ended March 31, 2025 primarily due to a decrease of $2.6 million in staff expenses and $0.1 million in marketing expense.

Previous wording

During the three months ended September 30, 2025, we realized a loss of $0.3 million primarily related to the decommissioning of the Dosh app, a consumer facing cashback mobile application, operated by Dosh Holding LLC on February 28, 2025. During the nine months ended September 30, 2025, we realized a gain of $4.8 million primarily related to the derecognition of the wallet liability associated with the Dosh app. Refer to Note 1—Overview of Business and Basis of Presentation for more information.

Current wording

During the three months ended March 31, 2025, we realized an expense of $5.4 million primarily due to the decommissioning of the Dosh app, a consumer facing cashback mobile application, operated by Dosh Holding LLC on February 28, 2025. Refer to Note 1—Overview of Business and Basis of Presentation for more information.

Previous wording

Depreciation and amortization expense decreased by $0.5 million during the three months ended September 30, 2025 compared to the three months ended September 30, 2024, primarily due to a decrease in fixed assets.

Current wording

Depreciation and amortization expense decreased by $0.4 million during the three months ended March 31, 2026 compared to the three months ended March 31, 2025, primarily due to a decrease in fixed assets.

Previous wording

Interest expense, net increased by $0.5 million during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 primarily due to an increase in interest expense due to the draw down on our 2018 Line of Credit, partially offset by an increase in interest income associated with the approval of the second quarter 2021 employee retention tax credit.

Current wording

Interest expense, net increased by $0.7 million during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to an increase in interest expense due to the draw down on our 2018 Line of Credit, partially offset by an increase in interest income associated with the approval of the second quarter 2021 employee retention tax credit.

Previous wording

Foreign currency (loss) gain was a loss of $1.8 million during the three months ended September 30, 2025 compared to a gain of $4.8 million during the three months ended September 30, 2024, primarily due to the change in the value of the British pound relative to the U.S. dollar.

Current wording

Foreign currency (loss) gain was a loss of $1.7 million during the three months ended March 31, 2026 compared to a gain of $2.6 million during the three months ended March 31, 2025, primarily due to the change in the value of the British pound relative to the U.S. dollar.

Previous wording

(1)We define working capital as current assets less current liabilities. See our consolidated financial statements for further details regarding our current assets and current liabilities.

Current wording

(1)We define working capital as current assets less current liabilities. See our condensed consolidated financial statements for further details regarding our current assets and current liabilities.

Previous wording

(2)As part of our amended and restated Loan and Security Agreement, we are required to maintain a minimum unrestricted cash of $25.0 million in demand deposit accounts.

Current wording

(2)As part of our amended and restated Loan and Security Agreement, we are required to maintain a minimum unrestricted cash of $20.0 million in demand deposit accounts.

Previous wording

Through September 30, 2025, we have incurred accumulated net losses of $1,395.8 million since inception, including net loss of $72.7 million for the three months ended September 30, 2025. We have historically financed our operations and capital expenditures through convertible note financings, private placements of our redeemable convertible preferred stock, public offerings of our common stock as well as lines of credit.

Current wording

Through March 31, 2026, we have incurred accumulated net losses of $1,408.5 million since inception, including net loss of $4.5 million for the three months ended March 31, 2026. We have historically financed our operations and capital expenditures through convertible note financings, private placements of our redeemable convertible preferred stock, public offerings of our common stock as well as lines of credit.

Previous wording

In January 2024, we renewed a cloud hosting agreement guaranteeing an aggregate spend to a cloud hosting provider of $17.0 million each year over a three-year period.

Current wording

In January 2024, we renewed a cloud hosting agreement guaranteeing aggregate spend to a cloud hosting provider of $17.0 million each year over a three-year period. During the second year of the agreement, we had $16.2 million of aggregated spend. As a result of the shortfall, we accrued $0.8 million within accrued expenses liability on our consolidated balance sheets as of December 31, 2025. During the three months ended March 31, 2026, we entered into a new five-year agreement which replaced the existing three-year agreement and remediated the shortfall from year two. As a result, we reversed the previously recognized $0.8 million expense. The new terms established a year-one guaranteed aggregate spend of $10.0 million, escalating by $0.5 million annually thereafter.

Previous wording

In April 2024, we repaid in full $30.0 million of the principal balance of the 2018 Line of Credit. Interest on advances under the 2018 Line of Credit bore an interest rate equal to the prime rate plus 0.25%. During the nine months ended September 30, 2024, we incurred approximately $0.7 million of interest expense associated with the 2018 Loan Facility. In addition, we are required to pay an unused line fee of 0.15% per annum on the average daily unused amount of the revolving commitment.

Current wording

In April 2024, we repaid in full $30.0 million of the principal balance of the 2018 Line of Credit. Interest on advances under the 2018 Line of Credit bore an interest rate equal to the prime rate plus 0.25%. During the three months ended March 31, 2025, we incurred approximately $0.7 million of interest expense associated with the 2018 Loan Facility. In addition, we are required to pay an unused line fee of 0.15% per annum on the average daily unused amount of the revolving commitment.

Previous wording

As of September 30, 2025, we had net borrowings of $46.1 million against the 2018 Line of Credit. As of September 30, 2025, we had $12.4 million of unused available borrowings under our 2018 Line of Credit. We believe we are in compliance with all financial covenants as of September 30, 2025.

Current wording

As of March 31, 2026, we had net borrowings of $35.1 million under the 2018 Line of Credit, which includes a repayment of $10.0 million on February 25, 2026 and a drawdown of $5.0 million on March 30, 2026. Subsequent to March 31, 2026, we repaid $20.1 million on April 7, 2026 under the 2018 Line of Credit. As of April 2026, we had $26.1 million of unused available borrowings under our 2018 Line of Credit.

Previous wording

Operating activities used $3.7 million of cash during the nine months ended September 30, 2025, which reflected our Net Loss of $95.2 million, including $94.3 million of non-cash charges, offset by a $2.8 million change in our net operating assets and liabilities. The non-cash charges primarily related to stock-based compensation expense, depreciation and amortization expense, amortization of right-of-use assets, amortization of financing costs charged to interest expense, credit losses expense, gain on disposal or divestiture and impairment of goodwill and intangible assets. The change in our net operating assets and liabilities was primarily due to a $8.0 million decrease in our Consumer Incentive liability, a $10.9 million decrease in Partner Share liability, a $0.2 million decrease in accounts payable and a $0.2 million increase in prepaid expenses and other assets, partially offset by a $14.8 million decrease in accounts receivable and a $1.8 million increase in other accrued expense. These fluctuations are primarily driven by the quarterly seasonality of our business.

Current wording

Operating activities used $5.6 million of cash during the three months ended March 31, 2026, which reflected our Net Loss of $4.5 million, including $1.3 million of non-cash charges, offset by a $0.1 million change in our net operating assets and liabilities. The non-cash charges primarily related to stock-based compensation expense, depreciation and amortization expense, amortization of right-of-use assets, amortization of financing costs charged to interest expense, credit losses expense, divestiture costs and impairment of goodwill and intangible assets. The change in our net operating assets and liabilities was primarily due to a $11.6 million decrease in our Consumer Incentive liability, a $7.2 million decrease in Partner Share liability, a $0.2 million decrease in accounts payable and a $0.6 million decrease in other accrued expense, partially offset by a $18.3 million decrease in accounts receivable and a $0.2 million increase in prepaid expenses and other assets. These fluctuations are primarily driven by the quarterly seasonality of our business.

Previous wording

Operating activities used $11.8 million of cash during the nine months ended September 30, 2024, which reflected our Net Loss of $173.7 million, including $172.7 million of non-cash charges, offset by a $10.9 million change in our net operating assets and liabilities. The non-cash charges primarily related to stock-based compensation expense, depreciation and amortization expense, amortization of right-of-use assets, amortization of financing costs charged to interest expense and credit losses expense. The change in our net operating assets and liabilities was primarily due to a $2.9 million decrease in our Consumer Incentive liability, a $18.3 million decrease in Partner Share liability, a $3.2 million decrease in other accrued expense and a $0.2 million increase in prepaid expenses and other assets, partially offset by a $12.9 million decrease in accounts receivable and a $0.8 million increase in accounts payable. These fluctuations are primarily driven by the quarterly seasonality of our business.

Current wording

Operating activities used $6.7 million of cash during the three months ended March 31, 2025, which reflected our Net Loss of $13.3 million, including $8.7 million of non-cash charges, offset by a $2.2 million change in our net operating assets and liabilities. The non-cash charges primarily related to stock-based compensation expense, depreciation and amortization expense, amortization of right-of-use assets, amortization of financing costs charged to interest expense and credit losses expense. The change in our net operating assets and liabilities was primarily due to a $8.2 million decrease in our Consumer Incentive liability, a $3.9 million decrease in Partner Share liability and a $0.1 million increase in prepaid expenses and other assets, partially offset by a $1.9 million increase in other accrued expense, a $7.5 million decrease in accounts receivable and a $0.6 million increase in accounts payable. These fluctuations are primarily driven by the quarterly seasonality of our business.

Previous wording

Investing activities used $13.0 million and $14.7 million of cash during the nine months ended September 30, 2025 and 2024, respectively. Our investing cash flows during the nine months ended September 30, 2025 and 2024 primarily consisted of funds used for the purchases of technology hardware and capitalization of costs to develop internal-use software.

Current wording

Investing activities used $2.3 million and $3.9 million of cash during the three months ended March 31, 2026 and 2025, respectively. Our investing cash flows during the three months ended March 31, 2026 and 2025 primarily consisted of funds used for the purchases of technology hardware and capitalization of costs to develop internal-use software.

Previous wording

Financing activities used $5.1 million of cash during the nine months ended September 30, 2025, which consisted of cash paid pursuant to the Settlement Agreement with the Stockholder Representative to resolve all outstanding disputes related to the Merger Agreement and the payment in full of the remaining $46.1 million aggregate principal amount of the 2020 Convertible Senior Notes, partially offset by net borrowings of $46.1 million against the 2018 Line of Credit.

Current wording

Financing activities used $3.0 million of cash during the three months ended March 31, 2025, which consisted of cash paid pursuant to the Settlement Agreement with the Stockholder Representative to resolve all outstanding disputes related to the Merger Agreement.