Ibotta, Inc. Reports Strong Q1 Earnings with Positive Outlook

Ibotta, Inc. Class A ((IBTA)) has held its Q1 earnings call. Read on for the main highlights of the call.

The recent earnings call for Ibotta, Inc. Class A reflected a generally positive sentiment, underscored by notable growth in revenue and successful partnerships. The company reported significant expansion in CPID campaigns with major clients, although challenges such as scaling CPID, a decline in D2C revenue, and lower gross margins were acknowledged.

Revenue and Adjusted EBITDA Exceed Expectations

Ibotta reported first quarter revenue of $84.6 million, marking a 3% increase year-over-year, and an adjusted EBITDA of $14.7 million with a 17% margin. Both figures exceeded the company’s guidance by 3% and 22%, respectively, showcasing strong financial performance.

Successful CPID Campaigns with Major CPG Clients

The company highlighted successful CPID campaigns with two major CPG clients, which resulted in a doubling and an 8x increase in redemption revenue year-over-year for these clients, demonstrating the effectiveness of their CPID strategies.

Expansion of Partnerships with Instacart and DoorDash

Ibotta expanded its network by integrating with Instacart and DoorDash, which led to attractive redemption rates and the inclusion of new categories such as beer, wine, and spirits, enhancing their market reach.

Growth in Total Redeemers

The number of total redeemers increased to 17.1 million, a 37% rise year-over-year. This growth was driven by the launch of Instacart and expansion with partners like Walmart and Family Dollar, indicating strong consumer engagement.

Reduced Turnover in Sales Team

The company reported a significant decrease in turnover among its sales team from Q4 2024 to Q1 2025, suggesting improved stability and morale within the sales force.

Decline in D2C Redemption Revenue

Ibotta faced a 24% year-over-year decline in D2C redemption revenue, highlighting challenges within the direct-to-consumer channels that the company needs to address.

Decrease in Redemption Revenue Per Redemption

There was a 7% year-on-year decrease in redemption revenue per redemption, attributed to a shift towards third-party redemptions, which may impact overall profitability.

Challenges in Scaling CPID Efforts

The CPID platform remains in the pilot phase, with significant manual processes required, which currently limits its ability to scale rapidly, presenting a challenge for future growth.

Lower Gross Margin

The non-GAAP gross margin decreased by nearly 700 basis points year-over-year, due to increased costs associated with new partnerships and technologies, impacting the company’s profitability.

Forward-Looking Guidance

Looking ahead, Ibotta maintains a positive outlook for Q2 2025, projecting revenue between $86.5 million and $92.5 million and an adjusted EBITDA margin of about 22%. The company is strategically focused on scaling its CPID platform, which has shown promising results in pilot tests, with expectations of significant revenue growth for key clients.

In conclusion, Ibotta’s earnings call reflected a positive sentiment with strong financial performance and successful partnerships driving growth. Despite challenges in scaling CPID and declines in certain revenue streams, the company remains optimistic about its strategic initiatives and future prospects.