Q1 2025 Global-E Online Ltd Earnings Call

Unknown Executive: Welcome to the Global-E First Quarter 2025 Earnings Call. This call is being simultaneously webcast on the company's website in the Investor Relations section under News and Events.

Welcome to the globally first quarter 'twenty 25 earnings call. This call is being simultaneously webcast on the company's website in the Investor Relations section under news and events for opening remarks, and introductions I will now turn the call over to Alan Katz Investor Relations. Please go ahead.

Alan Katz: For opening remarks and introductions, I will now turn the call over to Alan Katz. Investor Relations, please go ahead. Thank you and good morning, everyone. It's great to join the Global-E team.

Thank you and good morning, everyone. It's great to join the global 18 with me on the call today are a mere flick that co founder and Chief Executive Officer, Ofer, Koren, Chief Financial Officer, and your Debbie co founder and President Amir will begin with a review of the business results for the first quarter 2025, Okra will then review the financial.

Alan Katz: With me on the call today are Amir Schlachet, co-founder and chief executive officer, Ofer Koren, chief financial officer, and Nir Debbi, co-founder and president.

Amir Schlachet: Amir will begin with a review of the business results for the first quarter of 2025.

Ofer Koren: Ofer will then review the financial results for the first quarter, followed by the company's outlook for the second quarter and full year of 2025.

Results for the first quarter, followed by the company's outlook for the second quarter and full year 2025, well then open the call for questions.

Unknown Executive: We will then open the call for questions.

Unknown Executive: Certain statements we make today may constitute forward-looking statements, and information within the meeting of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the safe harbor provisions of the U.S. Private Security Litigation Reform Act of 1995 relate to our current expectations and views of future events. These forward-looking statements are subject to risks, uncertainties and assumptions, some of which are beyond their control. In addition, these forward-looking statements reflect our current views with respect to future events and are not a guarantee of future performance. Actual outcomes may differ materially from the information contained in the forward-looking statement as a result of a number of factors, including those set forth in the section titled Risk Factors in our prospectus filed with the SEC on September 13, 2021, and other documents filed or furnished to the SEC.

Certain statements, we make today may constitute forward looking statements and information within the meaning of SEC.

27 of the Securities Act of 1933 section 21 E of the Securities Exchange Act of 1934, and the Safe Harbor provisions of the U S. Private Securities Litigation Reform Act of 1995 seats to our current expectations and views of future events.

These forward looking statements are subject to risks uncertainties and assumptions some of which are beyond our control in.

In addition, these forward looking statements reflect our current views with respect to future events and are not a guarantee of future performance.

Actual outcomes may differ materially from the information contained in the forward looking statements as a result of a number of factors, including those set forth in the section titled risk factors in our prospectus filed with the SEC on September 13th 2021 and the other documents filed or furnished to the SEC. These statements reflect management's current expectations.

Unknown Executive: These statements reflect management's current expectations regarding future events and operating performance and speak only as of the date of this call. You should not put undue reliance on any forward-looking statement. Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that future results, levels of activity, performance, and events and circumstances reflected in the forward-looking statements will be achieved or will occur. Except as required by applicable law, we make no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events, or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.

Regarding future events and operating performance and speak only as of the date of this call you should not put undue reliance on any forward looking statements.

Although we believe the expectations reflected in the forward looking statements are reasonable we cannot guarantee that future results levels of activity performance and events and circumstances reflected in the forward looking statements will be achieved or will occur except as required by applicable law, we make no obligation to update or revise publicly any forward looking statements.

Whether as a result of new information future events or otherwise after the date on which the statements are made or to reflect the occurrence of unanticipated events. Please refer to our press release issued today you may 14th 2025 for additional information.

Unknown Executive: Please refer to our press release issued today, May 14, 2025, for additional information.

Unknown Executive: In addition, certain metrics we discussed today are non-GAP metrics. The presentation of this financial information is not intended to be considered in isolation from, or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. We use these non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. We believe that these measures provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making.

In addition, certain metrics, we discuss today are non-GAAP metrics. The presentation of this financial information is not intended to be considered in isolation from or as a substitute for or superior to the financial information prepared and presented in accordance with GAAP.

We use these non-GAAP financial measures for financial and operational decision, making and does it mean to evaluate period to period comparisons. We believe that these measures provide useful information about operating results enhance the overall understanding of past financial performance and future prospect and allow for greater transparency with respect to key metrics used by management.

And its financial and operational decision, making for more information on these non-GAAP financial measures. Please see the reconciliation tables provided in our press release issued today.

Unknown Executive: For more information on these non-GAAP financial measures, please see the reconciliation tables provided in our press release issued today.

Unknown Executive: Throughout this call, we provide a number of key performance indicators used by our management and often used by competitors in a range of... These and other key performance indicators are discussed in more detail in our press release issued today.

Throughout this call we provide a number of key performance indicators used by our management and often used by competitors in our industry. These and other key performance indicators are discussed in more detail in our press release issued today I will now turn the call over to Amir our co founder and CEO Mir. Please go ahead.

Amir Schlachet: I will now turn the call over to Amir, our co-founder and CEO. Amir, please go ahead.

Amir Schlachet: I would like to start by welcoming everyone to our first Quarterly Earnings Call of 2025, and also by extending a special welcome to Alan Katz, our newly-joined VP of Investor Relations. Some of you have already met Alan, and all of you will at some point. Welcome on board, Alan, and good luck.

Speaker Change: I would like to start by welcoming everyone to our first quarterly earnings call of 2025.

Speaker Change: So by extending a special welcome to all of the cuts are newly joined VP of Investor Relations.

Speaker Change: We've already met the island and older. If you will at some point welcome aboard Ellen and good luck.

Amir Schlachet: As for our financial results, we have had a strong start to 2025, with the first quarter results coming in at or above the midpoints of our guidance regions across the board. Despite the high level of uncertainties driven by the thermal in-duty tariffs and their potential adverse impact on global trade, we have continued to show strong GMV and top-line growth, coupled with strong execution and cost control. We finished Q1 with GMV of $1.24 billion, up 34% year-over-year, and with revenues of nearly $190 million, up 30% year-over-year. In terms of profit, our adjusted gross profit for Q1 was $86.3 million, up 31% from last year.

Speaker Change: As for our financial results, we have had a strong start to 2025 with the first quarter results coming in at or above the midpoint of our guidance ranges across the board.

Speaker Change: Despite the high level of uncertainties driven by the terminal in duty tariffs and there are potential adverse impact on global trade. We have continued to show strong DNV and topline growth coupled with strong execution and cost control.

Speaker Change: We finished Q1 with <unk> of $1 $24 billion up 34% year over year.

Speaker Change: And we have revenues of nearly $190 million up 30% year over year.

Speaker Change: In terms of profit our adjusted gross profit for Q1 was $86 $3 million up 31% from last year and quarterly adjusted EBITDA was 31 $6 million up 48% compared to the same quarter last year, resulting in a 16, 6% margin.

Amir Schlachet: And quarterly adjusted EBITDA was $31.6 million, up 48% compared to the same quarter last year, resulting in a 16.6% margin. As Ofer will share with you later in the call, taking into account the trading patterns in April and the first half of May. To date, we have yet to observe clear directional impact from the heightened U.S. import tariffs. However, these are very early days, as the removal of the de minimis on imports into the U.S. of goods that originate from China and Hong Kong, which is the most influential change for direct-to-consumer imports into the U.S., has only kicked in during the first week of May.

Speaker Change: As Ofer will share with you later in the call taking.

Ofer Koren: Taking into account the trading patterns in April and the first half of May.

Speaker Change: To date, we have yet to observe clear directional impact from the heightened U S import tariffs.

Speaker Change: However, they are very these are very early days.

Speaker Change: <unk> the de Minimis on imports into the U S with good stead originate from China, and Hong Kong, which is the most influential changed for direct to consumer imports into the U S is the only kicked in during the first week of May.

Amir Schlachet: Should this situation persist, some of our U.S. inbound GMV, which represents approximately 12% of our overall GMV, may be negatively impacted from significant retail price increases driven by high tariffs and the removal of the import demand. Moreover, future escalation in tariffs and counter-tariffs between the U.S. and its trade partners may further increase uncertainty for merchants and consumers alike, and weigh on merchant and consumer confidence around the world. For the time being, the situation remains highly dynamic.

Should this situation persists some of our U S inbound G M b, which represent approximately 12% of our overall G. M. B, maybe negatively impacted from significant retail price increases driven by higher tariffs and the removal of the import de minimis.

Speaker Change: Moreover, future escalation in tariffs and counter tariffs between the U S and its street partners me for increase uncertainty for merchants and consumers alike, and wait on merchant and consumer confidence around the world.

Speaker Change: For the time being the situation remains highly dynamic.

Amir Schlachet: As just today, a reduction in excess tariffs and a 90-day pause of further actions between the US and China, which was announced two days ago, is going into effect as they attempt to negotiate a new comprehensive trade deal. We are hopeful that this temporary pause will indeed lead to a broader de-escalation in tariffs around the world. But until then, uncertainties in the market are expected to persist.

Speaker Change: Just today, a reduction in excess tariffs and a 90 day pause or further actions between the U S and China, which was announced two days ago, he's going into effect, if the attempt to negotiate a new comprehensive trade deal.

Speaker Change: We are hopeful that this temporary pause will indeed lead to a broader de escalation in tariffs around the world, but until then uncertainties in the market are expected to persist.

Amir Schlachet: In parallel, as we discussed during our recent Investors' Day in New York, While current uncertainty can lead to disruption or challenges, we see these effects as relatively short to midterm in nature. Over the longer term, we believe this type of increased complexity in the global trade environment provides us with an opportunity to add further value to our existing merchants and to grow with new merchants. The rising complexities of international trade typically bring more and more brands to realize the tremendous business value we can bring to them, as well as our ability to help them to successfully navigate the fast-changing global trade dynamic.

Speaker Change: And part of though as we discussed during our recent Investor Day in New York while.

Speaker Change: While the current uncertainty can lead to disruption or challenges. We see these effects, it's relatively short to mid term in nature.

Speaker Change: Over the longer term, we believe this type of increased complexity in the global trading environment provides us with an opportunity to add further value to our existing merchants and to grow with new merchants.

Speaker Change: The rising complexity of international trade typically bring more and more brands to realize the tremendous business value, we can bring to them as well as our ability to help them to successfully navigate the fast changing global trade dynamics.

Amir Schlachet: As our merchants experience day in and day out, now more than ever, with Global-E in place, they can have peace of mind during turbulent times. We have their back. As soon as there is a change in regulation or in tariff levels, we not only notify them, but we also take all the necessary steps, including rapid R&D developments and deployments if needed, to make sure that they remain compliant at all times. Not less important, we provide them with data-driven advice and unique features and capabilities that can help them to mitigate potential adverse effects on their international business.

Speaker Change: Merchants experience day in and day out now more than ever with globally in place. They can have peace of mind during turbulent times, we have their back as soon as there is a change in regulation or tariff levels, we not only notify them, but we also take all the necessary steps, including rapid R&D developments in deep.

Speaker Change: <unk> if needed to make sure that they remain compliant at all times not.

Not less important we provide them with data driven advice and unique features and capabilities that can help them to mitigate potential adverse effects on the international business.

Amir Schlachet: We very much see this as an opportunity for continued growth. Taking into account the dynamic nature of all these uncertain factors and their unclear directional impact on our performance in the remainder of the year, we are reiterating our four-year guidance for 2025. We will continue to monitor the situation closely and will update you in the future, should our assessment.

Speaker Change: We very much series is an opportunity for continued growth.

Speaker Change: Taking into account the dynamic nature of all these uncertain factors and are unclear directional impact on our performance in the remainder of the year.

Speaker Change: We are reiterating our full year guidance for 2025.

Speaker Change: We will continue to monitor the situation closely and we'll update you in the future should our assessment change.

Amir Schlachet: Before we review our Q1 results and forward guidance in more detail, I would first like to share with you some of the recent and exciting business developments.

Speaker Change: Before we review, our Q1 results and forward guidance in more detail.

Speaker Change: I would first like to share with you some of the recent and exciting business developments.

Amir Schlachet: First and foremost, I'm happy to announce that we have signed a new three-year strategic partnership agreement with Shopify, replacing our prior 3P and 1P agreements with a new streamlined and unified strategic agreement. For more than four years now, we have fostered a great partnership with Shopify, which has enabled Shopify merchants of all sizes to utilize our state-of-the-art third-party merchant-of-record solutions and turbocharge their global direct-to-consumer sales, as well as to enjoy the benefits of the innovative and seamless Managed Markets offering. The new multi-year strategic partnership agreement we have signed with Shopify incorporates all the mutual learnings from our joint work along the years, as well as the necessary adaptations to support the updated strategic directions and goals of both our companies.

Speaker Change: First and foremost I'm happy to announce that we have signed a new three year strategic partnership agreement with Shopify.

Speaker Change: Replacing our prior three P M lumpy agreements with a new streamlined and unified strategic agreement.

Speaker Change: For more than four years now we have fostered a great partnership with Shopify, which has enabled shopify merchants of all sizes to utilize our state of the art third party merchant of record solutions and tumor charge their global direct to consumer sales as well as to enjoy the benefits of the innovative and seamless managed markets offering.

Speaker Change: Yeah.

Speaker Change: The new multi year strategic partnership agreement, we have signed with Shopify incorporates all the mutual learnings from our joint work along the years as well as the necessary adaptations to support the updated strategic direction and goals of both our companies.

Amir Schlachet: Under the new agreement on the 1P, or Managed Markets Front, Global-E will remain the exclusive provider of Merchant of Record or MRR services. for the Shopify branded. Global-E and Shopify will work together on a revised setup to be launched at a later stage. And these deeper integrations will create a more seamless merchant experience. We believe that once in place, this updated product approach should expand managed markets relevancy and appeal to a far larger cohort of Shopifymers. It is important to note, though, that this new operating model, which is also expected to impact the commercial structure of managed markets for Global-E, is not expected to have a notable effect on 2025 results.

Speaker Change: Under the new agreement under one P or managed markets fronts.

Speaker Change: Globally will remain the exclusive provider of merchant of record or MRO services.

Speaker Change: The shopify branded solution.

Speaker Change: <unk> and Shopify will work together on a revised set up to be launched at a later stage and these deeper integrations will create a more seamless merchant experience.

Speaker Change: We believe that once in place. This updated product approach should expand managed markets relevancy and appeal to a fault larger cohort of shopify merchants.

Speaker Change: It is important to note, though that this new operating model, which is also expected to impact the commercial structure of managed markets for globally.

Speaker Change: Expect it to have a notable effect on 2025 results.

Amir Schlachet: Within 3P, the new agreement will enable additional third-party MORR providers to operate on the Shopify platform in the future. However, we are confident that Global-E will be able to maintain its competitive advantage, as we will be the preferred Shopify partner for international MORL services, and will retain exclusive access to certain key features available on the Shopify platform. In addition, from a commercial perspective, we stand to benefit from revised commercial Given Shopify's impressive progress in growing and attracting larger businesses globally, this is an exciting extension of our partnership. providing international direct-to-consumer e-commerce support for large sellers on the Shopify platform.

Speaker Change: Within <unk>, the new arguments will enable additional third party MRO providers to operate on the shopify platform in the future.

Speaker Change: However, we are confident that globally, we will be able to maintain its competitive advantage as we will be the preferred shellfish like partner for international MRO services and will retain exclusive access to certain key features available on the shopify platform.

Speaker Change: In addition from a commercial perspective, we stand to benefit from a revised commercial terms.

Speaker Change: Given shopify is impressive progress in growing and attracting larger businesses globally. This is an exciting extension of our partnership.

Speaker Change: Providing international direct to consumer e-commerce support for large sellers on the Shopify platform.

Amir Schlachet: This new multi-year agreement is an exciting next step in our relationship with Shopify, one of our most important and long-standing partners, and we are looking forward to seeing where this takes us. I would just quickly note that we have contemplated most of the details around this agreement when we provided our multi-year outlook at our investor day in March, so nothing changes from that perspective, and we remain on track to deliver against our long-term targets for growth and profitability. As I mentioned earlier, merchants are increasingly faced with challenging and highly dynamic trade and regulatory environments, which is exactly where Global-E can come in and drive meaningful value.

Speaker Change: This new multi year agreement is an exciting next step in our relationship with Shopify one of our most important and longstanding partners and we are looking for it to see where this takes us.

Speaker Change: I would just quickly note that we have contemplated most of the details around disagreement when we provided our multiyear outlook at our Investor day in March So nothing changes from that perspective, and we remain on track to deliver against our long term targets for growth and profitability.

Speaker Change: As I mentioned earlier.

Speaker Change: Merchants are increasingly faced with challenging and highly dynamic trade and regulatory environments, which is exactly where globally can come in and drive meaningful value.

Amir Schlachet: Our suite of systems and solutions is not only highly robust, but also agile and flexible, thereby enabling us to quickly develop and deploy new capabilities as the needs of our merchants evolve. One clear example of that is our new 3B2C offering, developed in record time to enable global brands to leverage their international footprint in order to partially offset costs due to tariffs. By using this unique offering, merchants who have legal entities set up in various destination markets can now import goods into such markets as a B2B intra-company transaction, before conducting a local, in-market sale to the end consumer.

Speaker Change: Our suite of systems and solutions, because not only highly robust, but also agile and flexible, thereby enabling us to quickly develop and deploy new capabilities as the needs of our merchants evolve.

Speaker Change: One clear example of that is our new <unk> offering.

Speaker Change: <unk> in record time to enable global brands to leverage their international footprint in order to partially offset costs due to tariffs.

Speaker Change: Using this unique offering merchants, who have legal entity setup in various destination markets can now import goods into such markets as a BBB intra company transaction before conducting a local in market sale to the end consumer, thereby lowering the import duties burden.

Amir Schlachet: thereby lowering the import duties burden. Given the sharp movements we have recently observed in trade tariffs, we have seen a lot of interest from merchants, both existing and new, in using this unique 3B2C offering to mitigate, as much as possible, unnecessary price hikes in key destination markets, while avoiding The cost and ongoing complexities and effort involved in creating full-blown multi-local setups for these models.

Speaker Change: Given the sharp movements, we have recently observed and trade tariffs, we have seen a lot of interest for merchants, both existing and new in using this unique <unk> offering to mitigate as much as possible unnecessary price hikes in key destination markets while avoiding.

Speaker Change: The cost and ongoing complexities and effort involving creating full blown multi local setups for these markets.

Amir Schlachet: Another piece we delivered to our merchants during Q1 was an overhaul of our Merchant Portal. Beyond its new look and feel, the newly revamped portal enables for far easier access to frequently used areas, such as order search and others. Most notably, the new portal hosts two important tools for our merchants, a Realtime Sales Dashboard and a Funnel Analysis Dashboard. These self-service BI tools are designed to empower merchants with easy access to their sales data, allowing them to track and analyze key e-commerce KPIs directly in the Global-E portal, across all operational markets, and using many different metrics and dimensions, keeping merchants in full control of their stores' performance around the globe.

Speaker Change: Another piece, we delivered to our merchants during Q1 was an overhaul of our merchant portal.

The only thing you look and feel the newly revamped portal enables far easier access to frequently used areas such as order surge in others.

Speaker Change: Most notably the new portal hosts two important tools for our merchants are real time sales dashboard and the funnel analysis dashboard.

Speaker Change: This self service bi tools are designed to empower merchants with easy access to their sales data, allowing them to track and analyze key corners kpis directly into globally portal across all operations and markets and using many different metrics and dimensions, keeping merchants in full control of their stores.

Speaker Change: Performance around the globe.

Amir Schlachet: Such increased visibility and control are always important, but even more so now, as merchants need to be able to understand in real time the impact of various pricing and business decisions they take in reaction to market and regulatory changes. In terms of sales progress in the quarter, we continue to experience strong demand for our services across markets, as dozens of brands went live with Global-E during Q1. In Europe, we launched with Subdued out of Italy, and with Vive Footwear, our first large merchant based in Finland. We went live with several luxury brands, including Bali Shoes from Switzerland and Zimmermann in Australia, as well as JW Anderson, an LVMH brand, and Thomas Pink, both out of the UK.

Speaker Change: Such increase visibility and control are always important but even more so now as merchants need to be able to understanding real time, the impact of various pricing and business decisions may take in reaction to market and regulatory changes.

Speaker Change: In terms of sales progress in the quarter, we continued to experience strong demand for our services across markets is it dozens of brands went live with globally during Q1.

Speaker Change: In Europe, we launched with subdued out of Italy, and we've really footwear, our first large merchant based in Finland.

Speaker Change: We went live with several luxury brands, including Bally shoes from Switzerland, and Zimmerman in Australia, as well as J W. Anderson and that'll be a major brand and Thomas Pink both out of the U K.

Amir Schlachet: We also launched with Diane von Fossenberg in the U.S. During the quarter, we also expanded our portfolio of sports merchants, launching with Atletico Madrid in Spain. Our efforts to grow in Asia-Pacific continue to gain traction as well. During Q1, we launched with Japanese brands United Airs Tabaya, Sakai, and Bandai Namco, the multinational video game publisher of Pac-Man. We also launched three times in Suwon, Korea, and T2T in Scarlet and Sammy in Australia, among others. Lastly, we had a significant expansion of our business with several brands, most notably with the launch of Adidas Hong Kong, one of the biggest markets Adidas has launched with us to date.

Speaker Change: We also launched with Diane von Furstenberg in the U S.

Speaker Change: During the quarter, we also expanded our portfolio of sports merchants launching with athletic in Madrid in Spain.

Our efforts to grow in Asia Pacific continues to gain traction as well.

Speaker Change: During Q1, we launched with Japanese brands, United Arrows to buyer Sakai and Bondi Namco the multinational video game Publishers Pac man.

Speaker Change: We also launched with three times and sooner on doing Korea, and TCT, installers, and savvy and Australia among others.

Speaker Change: Lastly, we had a significant expansion of our business with several brands, most notably with the launch of Adidas Hong Kong one of the biggest markets Adidas is not with us today.

Amir Schlachet: With the traction we are seeing in the pipeline, dozens of other brands going live, and expansions across our various geographies, we believe we can continue on our growth path towards our long-term targets as merchants continue to leverage our services to support their global direct-to-consumer sales.

Speaker Change: With the traction we are seeing in the pipeline dozens of other brands going live and expansions across our various geographies. We believe we can continue on our growth path towards our long term targets as merchants continue to leverage our services to support their global direct to consumer sales.

Amir Schlachet: Before I hand it over to Ofer, I want to highlight another important step in our journey as a mature public company. Starting in Q2, we expect to move to gap profitability, as the amortization of the majority of the Shopify warrants will be done. By the start of 2026, these are expected to be fully amortized. We expect to get profitable also moving forward.

Speaker Change: Before I hand, it over to Ofer I want to highlight another important step in our journey as a mature public company.

Speaker Change: Starting in Q2, we expect to move to GAAP profitability is the amortization of the majority of the shopify warrants will be done.

Speaker Change: By the start of 2026 these are expected to be fully amortized.

Speaker Change: We expect to be GAAP profitable also moving forward.

Amir Schlachet: signifying our ability to continue generating long-term, durable, and profitable growth.

Signifying our ability to continue generating long term durable and profitable growth.

Ofer Koren: I will now hand it over to Ofer to take us through the quarterly numbers in more depth, as well as our reaffirmed 2025 guidance and the Q2 outline. Thank you, Amir.

Ofer Koren: I will now hand, it over to offer to take us through the quarterly numbers in more depth.

Ofer Koren: As well as our reaffirmed 2025 guidance and the Q2 outlook.

Ofer Koren: Thank you Amir and thanks, everyone for joining us today for our earnings call.

Ofer Koren: And thanks, everyone, for joining us today for As Amir mentioned, we are off to a strong start in 2020. Q1 came in, yet again, well above the rule of 40. Driven by the continued growth of volumes processed through a platform and healthy margin.

Ofer Koren: As Amir mentioned, we are off to a strong start in 2025.

Q1 came in yet again, well above the rule of 40% driven by the continued growth of volumes processed through our platform and healthy margins.

Ofer Koren: Before I go into the details of the quarter, I'd like to point out again that in addition to our GAAP results, I'll also be discussing certain non-GAAP results. Our GAAP financial results, along with the reconciliation between GAAP and non-GAAP results, can be found in our earnings. GMV in Q1 was $1.243 billion, up 34% year-over-year, and approximately 1% above the midpoint of a guidance range. While the elevated geopolitical and macroeconomic uncertainty has thus far resulted in only a modest impact on trade volumes in the first quarter, we remain attentive to the potential for a broader effect of the turmoil in global duty tariffs on consumer spending and e-commerce .

Ofer Koren: Before I go into the details of the quarter I would like to point out again that in addition to our GAAP results I'll also be discussing certain non-GAAP results our.

Ofer Koren: Our GAAP financial results along with the reconciliation between GAAP and non-GAAP results can be found in our earnings release.

Ofer Koren: <unk> Q1 was 1.2 for $3 billion up 34% year over year, and approximately 1% above the midpoint of our guidance range for Q1.

Ofer Koren: While the elevated geopolitical and macroeconomic uncertainty thus far resulted in only a modest impact on freight volumes in the first quarter, we remain attentive to the potential for a broader effect of the turmoil in global duty tariffs on consumer spending and E Commerce trade.

Ofer Koren: In Q1, we generated total revenue of $189.9 million, up 30% year-over-year, and again, 1% above the midpoint of our guidance. Service fees revenue or $84 million up 23% and fulfillment services revenue were up 36% to $105.9 Growth of the fulfillment revenue was favorably impacted by GMV mix, while growth of service fees was impacted by the bankruptcy of Tebaker UK and EU Distributor, as well as a GMV mix share of larger merchants in trading compared to Q1 of the previous year. Progressing through the income statement, non-gap gross profit was $86.3 million, up 31% year-over-year, representing a gross margin of 45.4% compared to 45.3% in the same period last year.

Ofer Koren: In Q1, we generated total revenue of $189 $9 million up 30% year over year, and again, 1% above the midpoint of our guidance range.

Ofer Koren: Service fees revenue were $84 million up 23% and fulfillment services revenue were up 36% to $105 9 million dollar.

Ofer Koren: Growth of the procurement revenue was favorably impacted by JMP mix, while growth of service fees was impacted by the bankruptcy of Ted Baker, UK and EU distributor as well as a GMP mix share of larger merchants and trading compared to Q1 for the previous year.

Ofer Koren: Progressing through the income statement non-GAAP gross profit was $86 $3 million up 31% year over year.

Ofer Koren: Representing a gross margin of 45, 4% compared to 45, 3% in the same period last year.

Ofer Koren: Gap gross profit was $84.1 million, representing a margin of 44.3%.

Ofer Koren: GAAP gross profit was $84 $1 million, representing a margin of 44, 3%.

Ofer Koren: Moving on to operational expenses, we continue to invest in the development of our platform to further enhance and expand our various offerings. R&D expense in Q1, excluding stock-based compensation, was $24.5 million, or 12.9% of revenue, compared to $20.1 million, or 13.8% the same period last year. Total R&D spend in Q1 was $28.1 million. We continue to allocate resources toward sales and marketing to support growth, while remaining focused on operational efficiency. Sales and marketing expense excluding Shopify-related amortization expenses, stock-based compensation, and acquisition-related intangibles amortization was $23.3 million, or 12.3% of revenue, compared to $17.2 million, or 11.8% of revenue, in the same period last year.

Ofer Koren: Moving onto operational expenses, we continue to invest in the development of our platform to further enhance and expand our various offerings.

Ofer Koren: R&D expense in Q1, excluding stock based compensation was $24 $5 million or 12, 9% of revenue compared to $21 million or 13, 8% in the same period last year.

Ofer Koren: Total R&D spend in Q1 was $28 $1 million.

Ofer Koren: We continue to allocate resources towards sales and marketing to support growth, while remaining focused on operational efficiency.

Ofer Koren: Sales and marketing expense, excluding shopify related amortization expenses stock based compensation and acquisition related intangibles amortization was $23 $3 million or 12, 3% of revenue compared to $17 $2 million or 11, 8% of revenue in the same.

Ofer Koren: Period last year.

Ofer Koren: Shopify warrants related amortization expense was $37 million. As a reminder, we expect this expense to decrease significantly in Q2 and to be completely gone at the beginning of 2021. Total sales and marketing expenses for the quarter were $63.9 million. General and administrative expenses excluding stock-based compensation were $7.7 million or 4.1% of revenue, compared to $8.3 million or 5.7% of revenue in Q1 of last year. Total GNA spend in the first quarter was $11.2 million.

Ofer Koren: Shopify warrants related amortization expense was $37 million as a reminder, we expect these expenses to decrease significantly in Q2 and to be completely gone at the beginning of 2026.

Ofer Koren: Sales and marketing expenses for the quarter were $63 $9 million.

Ofer Koren: General and administrative expenses, excluding stock based compensation were $7 $7 million or four 1% of revenue compared to $8 $3 million or five 7% of revenue in Q1 of last year.

Ofer Koren: Total G&A spend in the first quarter was $11 $2 million.

Ofer Koren: We continue to show rapid adjusted EBITDA growth in the quarter. Adjusted EBITDA was $31.6 million, up 48% from Q1 2024. Adjusted EBITDA margin was 16.6%. The net loss in the quarter was $17.9 million compared to a net loss of $32.1 million in the year-ago period. The net loss was driven mainly by the amortization expenses related to the Shopify war.

Ofer Koren: We continued to show rapid adjusted EBITDA growth in the quarter adjusted EBITDA was $31 $6 million up 48% from Q1 2024.

Ofer Koren: Adjusted EBITDA margin was 16, 6%.

Ofer Koren: The net loss in the quarter was $17 $9 million compared to a net loss of $32 $1 million in the year ago period.

Ofer Koren: Net loss was driven mainly by the amortization expenses related to the shopify warrant.

Ofer Koren: Moving on to the balance sheet and cash flow statements, we've ended the quarter with $445 million in cash and cash equivalents, including short-term deposits and marketable securities. Free cash flow used in Q1 was $72.6 million compared to $55.1 million used a year ago. As a reminder, we typically see an outflow of cash in the first quarter driven by post-peak working capital dynamics. In Q1 2025, operating cash flow was also negatively impacted by delayed VAT returns due to an audit we went through. The audit ended successfully and the funds were received in Q2. Cash flow used by operating activities was $72.1 million compared to $54.3 million used the year ago.

Ofer Koren: Moving onto the balance sheet and cash flow statements. We've ended the quarter with $445 million in cash and cash equivalents, including short term deposits and marketable securities free.

Ofer Koren: Free cash flow used in Q1 was 72 $6 million compared to $55 1 million.

Ofer Koren: <unk> used a year ago as a reminder, we typically see an outflow of cash in the first quarter driven by post peak working capital dynamics in.

Ofer Koren: In Q1 2025 operating cash flow was also negatively impacted by delayed VT returned due to an audit. We went through the audit ended successfully in the funds were received in Q2.

Ofer Koren: Cash flow used by operating activities was $72 $1 million compared to $54 $3 million used a year ago.

Ofer Koren: Before we move on to our financial outlook and guidance for Q2 and 2025, I'd like to share our view given the current environment. We witness an increased level of uncertainty due to the current turmoil in global trade caused by the changes in duty tariffs. But no clear directional impact at this stage.

Ofer Koren: Before we move on to our financial outlook and guidance for Q2 in 2025, I'd like to share our view given the current environment.

Ofer Koren: We've witnessed an increased level of uncertainty due to the current turmoil in global trade caused by the changes in <unk>.

Ofer Koren: But no clear directional impact at this stage, hence we are leaving our full year 2025 guidance unchanged.

Ofer Koren: Hence, we are leaving our full year 2025 guidance on Now let's go through the Q2 and full-year guidance. For Q2 2025, we're expecting GMV to be in the range of $1.387 to $1.427 billion. At the midpoint of the range, this represents a growth rate of 30% versus Q2 of 2021. We expect YouTube revenue to be in the range of $204 to $211 million dollars, representing the year-over-year growth rate of 23.5% at the For Adjusted Dividend, we're expecting a profit in the range of $35 to $39 million, or a margin of 18%. For the full year of 2025, as mentioned already, we are maintaining our guidance ranges.

Ofer Koren: Now, let's go through the Q2 and full year guidance for Q2 2025, we are expecting <unk> to be in the range of 1.387 to one $427 billion at the midpoint of the range. This represents a growth rate of 30% versus Q2 of 2024.

Ofer Koren: We expect Q2 revenue to be in the range of $204 million to $211 million, representing a year over year growth rate of 23, 5% at the midpoint.

Ofer Koren: Adjusted EBITDA, we're expecting a profit in the range of 35% to $39 million or a margin of 18% at the midpoint.

Ofer Koren: For the full year of 2025 as mentioned already we are maintaining our guidance range as we continue to anticipate <unk> to be in the range of 6.19% to $649 billion, representing a 35% annual growth rate at the midpoint of the range revenue.

Ofer Koren: We continue to anticipate GMV to be in the range of $6.19 to $6.49 billion, representing a 30.5% annual growth rate at the midpoint of the range. Revenue is expected to be in the range of $900 17 to $967 million, representing a growth rate of 25% in the midpoint of the range. For adjusted EBITDA, we're expecting a profit of $179 to $199 million.

Ofer Koren: <unk> is expected to be in the range of 900 and.

Ofer Koren: And $17 million to $967 million representing.

Ofer Koren: Representing a growth rate of 25% in the midpoint of the range.

Ofer Koren: Our adjusted EBITDA, we're expecting a profit of $179 million to $199 million.

Ofer Koren: We believe that the current environment presents an opportunity for Global-E. More than ever, merchants are excited by our value proposition in the face of an increasingly complicated and fast-changing international e-commerce environment. Moreover, we believe that the long-term partnership with Shopify will continue to play an important role in our growth journey.

Ofer Koren: We believe that the current environment presents an opportunity for globally.

Ofer Koren: More than ever merchants are excited by our value proposition in the face of an increasingly complicated and fast changing international E Commerce environment.

Ofer Koren: Moreover, we believe that the long term partnership with Shopify will continue to play an important role in our growth journey.

Ofer Koren: The market opportunity in front of us remains massive, and we continue on our path to support merchants worldwide in expanding their direct-to-consumer business.

Ofer Koren: The market opportunity in front of US remains massive and we continue on our path to support merchants worldwide in expanding their direct to consumer business.

Unknown Executive: And with that Amir, Nir, Ellen, and I are happy to answer questions you may have. Operator? Thank you.

Ofer Koren: And with that EMEA.

Speaker Change: EMEA near Alan and I are happy to answer questions you may have operator.

Unknown Executive: Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star followed by the 1 on your touchtone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star followed by the 2. If you are using a speakerphone, please lift the handset before pressing any.

Thank you ladies and gentlemen, we will now begin the question and answer session should you have a question. Please press star followed by the one on your Touchtone phone you will hear prompt that Johan has been raised Jewish did decline from the polling process. Please press star followed by the Q.

Speaker Change: If you are using a speaker phone please lift the handset before pressing any keys in an effort to give everyone an opportunity to ask a question. We ask that people ask one question and one follow up question.

Unknown Executive: In an effort to give everyone an opportunity to ask a question, we ask that people ask one question and one follow-up question.

Will Nance: Your first question comes from Will Nance with Goldman Sachs. Your line is now open. Hey guys, good morning. Thank you for taking the questions. I wanted to maybe start off on some of the macroeconomic commentary you had. It sounds like to date you haven't seen any kind of directional impact from the escalation of some of the trade discussions that we've had. But I wanted to come back to some of the comments you made at the beginning of the year because I think you were one of the few companies that we cover that I think had the foresight to embed some of the initial impacts of potential trade policies into the guidance from the beginning of the year.

Speaker Change: Your first question comes from <unk> <unk>.

Speaker Change: <unk> with Goldman Sachs. Your line is now open.

Speaker Change: Hey, guys. Good morning, Thank you for taking the questions I wanted to maybe start off on some of the macroeconomic commentary you had it sounds like.

Speaker Change: You haven't seen any kind of directional impact from the escalation of some of the trade discussions that we've had.

But I wanted to come back to some of the comments you made at the beginning of the year because I think you're one of the few companies that we cover that I think had the foresight to embed some of the initial impacts of potential trade policies into the guidance from the beginning of the year. So I was wondering if you could just maybe remind us what's baked in in terms of the potential for demand destruction as well.

Amir Schlachet: So I was wondering if you could just maybe remind us what's baked in in terms of the potential for demand destruction as well as some of the shifts to a multi-local offering in the outlook for the full year. And if you could maybe just give us a sense for how we're sort of tracking against those assumptions to date and kind of what you would need to see in order to embed more macroeconomic pressure. It sounds like you haven't seen much to date. Thanks. Yes, so we thank you for that.

Speaker Change: Add some of the shifts to a multi local offering in the outlook for the full year and if you could.

Speaker Change: Maybe just give us a sense for how we're sort of tracking against those assumptions to date and kind of what you would need to see in order to embed.

Speaker Change: More macroeconomic pressure sounds like you haven't seen much today.

Speaker Change: Yes.

Amir Schlachet: You know, as we discussed in our prepared remarks, we definitely see greater uncertainty in the geopolitical and macro environment. As you mentioned, we have sort of incorporated a certain impact in our, you know, full year guidance in the previous quarter. And since then, you have seen some limited impact. Same-store sales are slightly lower than our multi-year average. But as we mentioned, you know, even though the trade tariffs dynamics are creating a lot of uncertainty, we haven't identified any clear trends in trading patterns. And thus, you know, despite the higher uncertainty, we maintain our guidance for the full year and we believe that our performance will be within the guidance range.

Speaker Change: Thank you for that as we discussed in our prepared remarks, we definitely see a greater uncertainty in the geopolitical and macro environment.

Speaker Change: Mentioned, we have a sort of <unk>.

Speaker Change: We incorporated a certain impact in our in our <unk>.

Full year guidance and the previous quarter.

And since then.

Speaker Change: We have seen Uh huh.

Speaker Change: Some are limited impact same store sales are slightly lower than our multiyear average, but as we've mentioned.

Speaker Change: You know even though.

Speaker Change: The trade tariffs dynamics are creating a lot of uncertainty we haven't identified any.

Speaker Change: The clear trends in trading Pat trends.

Speaker Change: And this.

Speaker Change: Despite.

Speaker Change: The higher.

Speaker Change: Uncertainty.

Speaker Change: We maintain our guidance for the full year and we believe that our performance will be within the guidance range.

Unknown Executive: Got it. Okay, that's helpful.

Speaker Change: Got it Okay. That's helpful. And then just on the Shopify partnership I wanted to maybe focus a little bit on.

Unknown Executive: And then just on the Shopify partnership, I wanted to maybe focus a little bit on the renewal. And so I guess on the managed market side, it sounds like you guys are going to work towards, you know, an updated rollout that can accelerate the growth of that product. Any changes or any thoughts around the timeline for continued expansion of managed markets?

Speaker Change: The renewable and so I guess on the on the managed market side. It sounds like you guys are going to work towards.

Speaker Change: And updated rollout that and accelerate the growth of that product.

Speaker Change: Any changes or any thoughts around the timeline for continued expansion of managed markets and then just on the third party side I was wondering if you could talk about velocity exclusivity specifically it sounds like youll retain preferred provider status.

Unknown Executive: And then just on the third party side, I was wondering if you could talk about the loss of exclusivity. Specifically, it sounds like you'll retain preferred provider status. But, you know, how are you thinking about that? How did you weigh the cost benefit of that relative to the enhanced commercial terms on the 3P side?

Speaker Change: How are you thinking about that how did you weigh the cost benefit of that relative to the enhanced commercial terms on the <unk> side.

Amir Schlachet: Appreciate you taking the questions today. First, we're very happy to extend our long-lasting relationship with Shopify for a new multi-year agreement. They have been a great partner for us for more than four years now, and we are looking forward to continue building this partnership. Moving in from the exclusivity to the preferred partner status, it does give us exclusivity on certain key features on the 3P side. as well as alignment with Shopify on future releases. Moreover, for the last four years, we have managed to build a robust capability and integration into Shopify that, combined with our general scale, expertise, and track record within Shopify and outside, gives us, I would say, a strong belief that we will maintain our leadership position.

Speaker Change: I appreciate you taking the questions today.

Speaker Change: I will first.

Speaker Change: We're very happy to extend our long lasting relationship with shopify for a new multiyear agreement.

Speaker Change: There has been a great partner for us for more than four years now and we are looking forward to.

Speaker Change: To continue building this partnership.

Speaker Change: Moving in from the exclusivity as a preferred partner status.

Speaker Change: It does give us exclusivity on certain key features on the <unk> side.

Speaker Change: As well as alignment with shopify on future feature releases.

Speaker Change: Moreover for the last four years, we have managed to build a robust capability and integration into.

Speaker Change: Into shopify.

Speaker Change: That combined with all the general scale expertise and track record within Shopify and outside.

Speaker Change: It gives us I would say a strong belief that we will maintain our leadership position.

Amir Schlachet: We do believe that the transition might cause some increase to potential competition. However, as I said, we did establish ourselves in the market as a market leader for cross-border and global e-commerce services, especially on Shopify, where we were the only player for the last four years, building a competitive mode based on our expertise and track record. Moving into the decision of Shopify to move out of the exclusivity model into a transition into a preferred, we believe that Shopify wants to provide more flexibility to its merchants, especially in light of winning businesses with enterprise merchants from other platforms. Such large merchants re-platforming may have existing relationship with other providers, including, in certain cases, international e-commerce.

Speaker Change: We do believe that the transition Mike.

Speaker Change: Cause some increase to potential competition competition. However, as I said, we did establish ourselves in the market as a whole as a market leader for cross border and our global E Commerce services.

Especially on Shopify, we will we will we will only play out for the last for the last four years building a competitive moat.

Speaker Change: Based on our expertise and track record.

Speaker Change: Moving into our.

Speaker Change:

Speaker Change: Just the decision of Shopify.

Speaker Change: And to move out of the exclusivity and modeling and transition into a preferred.

Speaker Change: We believe that <unk> wants to provide more flexibility with motion and merchant.

Speaker Change: Especially in light of.

Speaker Change: Winning business with enterprise merchants, a form other platform such large merchants re platforming may have.

Speaker Change: Shifting to our relationship with other providers, including.

Speaker Change: In certain cases.

Speaker Change: International ecommerce.

Amir Schlachet: Nevertheless, we are remaining as a preferred provider and have the most robust integration, so we feel quite confident on our competitive model.

Speaker Change: And nevertheless, we all.

Meaning as a preferred provider.

Speaker Change: Has the most robust integration so we feel quite confident.

Speaker Change: Our competitive mode.

Unknown Executive: I think there was a question also relating to the one piece. If you can remind me what is what. Yeah, thanks.

Speaker Change: I think there was a question also relating to the one P.

Speaker Change: If you can remind me what is what.

Unknown Executive: It was just the any impacts of the new structure to the timing of rollout of product releases on managed markets. So, we do continue, as we indicated also in our investor day, we do continue to build with Shopify and streamline what we identified that needs further streamlining. Streamlining in the build to reduce friction. We are aiming for future releases over time of the new capabilities. We will do it on a gradual basis over the coming quarters within future releases.

Speaker Change: Yeah. Thanks, It was just the any impacts.

Speaker Change: New structure to the timing of rollout of product releases are managed markets.

Speaker Change: So.

Speaker Change: We do continue as we indicated also in our Investor day, we do continue to build.

Speaker Change: <unk> and.

Speaker Change: And streamline what we identified that needs further streamlining streamlining in the field.

Speaker Change: To reduce to reduce friction.

Speaker Change: We are aiming.

Speaker Change: Paul.

Speaker Change: Future releases of overtime.

Speaker Change: Of the new of the new of.

Speaker Change: Of the new capability.

Speaker Change: We'll do it on a gradual basis over the coming quarters.

Speaker Change: Within our within within future releases.

Speaker Change: Okay.

Unknown Executive: Thanks for taking the question.

Speaker Change: For taking the questions.

Brian Peterson: Your next question comes from Brian Peterson with Raymond James. The line is now open. Hi, gentlemen, thanks for taking the question. So, Ofer, I know you mentioned that you didn't see any clear direction on GMV trends thus far, but I'm curious if you did see any instances of pull forward of early ordering ahead of tariffs, any pricing changes, and I understand maybe that's not across the broad base, but are there pockets or geos where you're seeing certain trends that you'd call out? Just love to get more perspective there.

Your next question comes from Brian Peterson with Raymond James Your line is now open.

Speaker Change: Hi, gentlemen, thanks for taking the question. So Ofer I know you mentioned that you didn't see any clear direction on GSV trends, thus far but I'm curious if you did see any instances of pull forward of early ordering ahead of tariffs any pricing changes and I understand maybe thats not across the broad base, but are there pockets.

Speaker Change: It's our Geos, where youre seeing certain trends that you'd call out just love to get more perspective there.

Speaker Change: Okay.

Ofer Koren: Thank you for the question, Brian. Yes, we haven't seen any clear direction. We have seen pockets of influence. One that I would note is that since the beginning of May, we have seen some softness with certain merchants trading high-sharing mix with goods with China or Hong Kong origin into the US. So that would be one notable example.

Speaker Change: Thank you for the question Brian.

Speaker Change: Yes, we have seen where we haven't seen any again any clear direction, we have seen pockets of.

Speaker Change: Of influenza.

Speaker Change: One that I would note is.

Speaker Change: Since the beginning of May we have seen some softness with certain merchant trading.

Speaker Change: Hi, Sharon in mix with the goods.

Speaker Change: With China, or Hong Kong or region into the U S.

Speaker Change: So that would be net one notable example, however.

Unknown Executive: However, these are certain pockets and we haven't seen any clear directional impact thus far. Got it.

Speaker Change: Certain pockets and we haven't seen any clear direction and impact.

Speaker Change: Impact thus far.

Speaker Change: Okay.

Speaker Change: Got it and maybe just as a follow up as Youre thinking about your broader e-commerce relationships outside of Shopify in terms of some of the larger players there Howard.

Unknown Executive: And maybe just as a follow up, as you're thinking about your broader e-commerce relationships outside of Shopify in terms of some of the larger players there, how influential are those vendors in terms of bringing in new enterprise customers to you? And does that change at all with the lack of exclusivity with Shopify? Thanks, guys.

Speaker Change: Sequential or those vendors in terms of bringing in new enterprise customers to you and it does that change at all with the lack of exclusivity with shopify. Thanks guys.

Nir Debbi: Hi, Brian, it's Neil. We don't expect to see any major shift in dynamics on the competitive side. Globally, it's been the clear market leader in global e-commerce across basically all e-commerce platforms, from Salesforce to Magento to Hybris and into Shopify, competing on a level playing field, so we are quite confident that with our unique track record expertise and the preferred situation on Shopify, we will not see any significant change in the dynamics also on the Shopify platform.

Neal: Hi, Brian It's Neal.

Speaker Change: We don't expect to see any major.

Speaker Change: NATO shift in dynamics.

Speaker Change: On the competitive side globally has been the clear market leader in global E Commerce across basically all e-commerce platform format from Salesforce to magenta to AR.

Speaker Change: To a hybrid with an end to end into shopify.

Speaker Change: Competing on.

Speaker Change: On a level playing field. So we are quite confident that with the <unk>.

Speaker Change: L. A unique track record expertise and a preferred situation on shopify and we will not see.

Speaker Change: We will not see any significant changes the dynamics.

Speaker Change: Also on the Shopify platform.

Speaker Change: Okay.

James Faucette: Your next question comes from James Faucette with Morgan Stanley. Your line is now open. Thank you so much. I appreciate the comments this morning, everybody.

Speaker Change: Your next question comes from James Fawcett with Morgan Stanley. Your line is now open.

James Fawcett: Thank you so much I appreciate the comments this morning, everybody I wanted to touch on really quickly.

Unknown Executive: I wanted to touch on really quickly how you're thinking about your NDR expectations relative to kind of where you started the year. It sounds like maybe same-store sales are turning a bit lower, but you can correct me if that's right or wrong. But on the other hand, it seems like your large enterprise merchant partners that were signed up in the back half of 2024 are ramping quite aggressively. So just any commentary you have on evolution of the NDR component in your forecast. Yeah, sure, James. Thank you for the question. As I mentioned, we haven't seen the, you know, through the weeks, there is some volatility.

James Fawcett: Or how youre thinking about your NDA, our expectations relative to kind of where you started the year. It sounds like maybe same store sales are trending a bit lower but you can correct me, if that's right or wrong, but on the other hand. It seems like your large enterprise merchant partners that were signed up in the back half of 'twenty for wrapping.

James Fawcett: Quite aggressively so.

James Fawcett: Just any commentary you have on on evolution of Av.

The MBR component in your forecasting.

James Fawcett: Yes sure James Thank you for the question.

James Fawcett: <unk>.

James Fawcett: As I mentioned, we haven't seen that.

James Fawcett: Five weeks there is some volatility, but generally speaking we haven't seen any sort of notable.

Unknown Executive: But generally speaking, we haven't seen any sort of notable change. On average, same source is slightly lower than our historical average. But we expected this going into the year. As you mentioned, yes, we are seeing, we have seen a very nice ramp up from sort of the larger new merchants already in Q4. And actually, we see very positive trade patterns with some of those merchants in Q1 as well. So we're quite happy about that. And yeah, there is definitely, you know, it's an interesting year, there is definitely some uncertainty. But up till now, it has been trading close to our expectation.

Speaker Change: Jean Jacques on average same store sales slightly lower than our historical.

Average, but we expected.

Speaker Change: This growing.

Speaker Change: Into the year.

Speaker Change: As you mentioned, yes, we are seeing we have seen a very nice ramp up from.

Speaker Change: From.

Speaker Change: The large new merchants already in <unk>.

Speaker Change: Q4 and actually.

Speaker Change: We see very positive trade pad trends.

Speaker Change: With some of those merchants in.

Speaker Change: In Q1.

Speaker Change: As well so.

Speaker Change: We are quite happy.

Speaker Change: About debt and.

Speaker Change: Yes, there is definitely.

Speaker Change: It's an interesting year there is definitely some.

Speaker Change: Uncertainty, but up till now it has been trading close to our expectations.

Speaker Change: Yeah.

Unknown Executive: Got it.

Speaker Change: Got it and then I wanted to ask just a few moving parts and how it's impacted your first quarter, Jim GMB growth as well as your outlook.

Unknown Executive: And then I wanted to ask just on a few moving parts and how it's impacted your first quarter GMV growth as well as your outlook. Can you help us over parse like FX?

Speaker Change: Can you help us over pars like FX.

Ofer Koren: We know that, or at least we've seen headlines that there may have been a ransomware attack on Marks and Spencer, and then the bankruptcy and closure of Forever 21. Just wondering how those are impacting the GMB and trying to get a sense for constant currency. GMB grew up excluding some of these items. I'll break your question into two elements. On the ethics and its impact on the quarter results and focus going forward, we don't see any material impact. There were some changes within the quarter, but it changed direction, so no material impact there versus constant current.

Speaker Change: We know that or at least you've seen headlines that there may have been a ransomware attack on marks and Spencer and then.

Speaker Change: Bankruptcy and closure Forever 21, just wondering how those.

Speaker Change: Are impacting the GMB and trying to get a sense for constant currency, Jim the growth excluding some of these items.

Speaker Change: Okay.

Speaker Change: So I'll break your question into two elements on the on the ethics.

Speaker Change: And its and its impact.

Speaker Change: On the quarter results and focus going forward, we don't see any material.

We don't see any material impact there were some changes within the quarter about it.

Speaker Change: And change direction, so no material impact versus the constant currency.

Speaker Change: Hum.

Ofer Koren: As you related to M&S, it's one of our largest clients, they are unfortunately facing some kind of a cyber attack, it does affect trading, for the last, for a period of time now have not been trading online with Global-E, and outside Global-E due to the attack, however, it did not have any material effect on our Q1, as it was only partial effect in Q1, and we do hope that it will be resolved within the coming period, so it will not have a major effect on our Q2 and the rest of the year, we did make some of it into our Q2 guidance already.

Speaker Change: Is it related to.

Speaker Change: It's one of our largest clients they all unfortunately.

Speaker Change: Facing.

Speaker Change: Facing some some kind of a.

Speaker Change: Cyber attack.

Speaker Change: It does affect tradings.

Speaker Change: For the last.

Speaker Change: For a period of time now have not been trading online with global is in and outside globally due to the attack.

Speaker Change: However.

Speaker Change: <unk>.

Speaker Change: No.

Speaker Change: Any material effect on our Q1 is it was only possible.

Speaker Change: In Q1, and we do hope that it will be resolved.

Speaker Change: Within the within the coming period, so it will not.

Speaker Change: As a major asset.

Speaker Change: On our Q2 and the rest of the year.

Speaker Change: We did make some of it into ours.

Speaker Change: Into our Q2 guidance already.

Ofer Koren: All in all, the macroeconomic, as you stated, there are some foreclosures, it is a difficult time for merchants, the global turmoil coming out of the changes in tariffs around the world doesn't do it any easier for merchants, and consumer sentiment is not at its peak. However, we took that into account once we gave at the beginning of the year the guidance for the year. We have seen a slight slowdown from there, but all in all, we don't see any clear change from what we've seen at the beginning of the year.

Speaker Change: All in all the macro economic as you stated there are some coal closure that it is a difficult time for merchants that global turmoil coming out of the <unk>.

Speaker Change: Changes entirely surround the world doesn't do.

Speaker Change: It doesn't do it any easier for merchants and the.

Speaker Change: Consumer sentiment is not at its peak.

Speaker Change: However, we took that into account monthly gave at the beginning of the year of the guidance for the year.

Speaker Change: We have seen slight.

Speaker Change: Slight slowdown from there, but all in all we don't see any any any clear.

Speaker Change: Change from what we've seen at the beginning of the year.

Chris Zhang: Your next question comes from Chris Zhang with UBS. Your line is now open. Hi. Thanks a lot for taking my question. My first question is around the details in the announcement saying that managed markets will now leverage Shopify payments for future versions of managed markets. The first part of my question is, will this be also applied to the existing Shopify markets volumes? And what's the timeline of the rollout of Shopify payments to managed markets? And how do you see that impact your revenue on the service side? Because managed markets, I believe, previously includes the payments revenue as well as the 2.5% FX conversion fee.

Speaker Change: Your next question comes from Chris Zhang with UBS. Your line is now open.

Chris Zhang: Hey, Thanks, a lot for taking my question. My first question is around.

Chris Zhang: The details of any announcements, saying that managed market small now leverage shopify payments.

Chris Zhang: Sorry, the future contract for future versions of managed markets.

Chris Zhang: The first part of my question is will this be also applied to the existing stockpile shopify managed markets volumes and.

Chris Zhang: What's the timeline of the rollout of shopify payments to managed markets.

Chris Zhang: How do you how do you see that impact your revenue on the service side.

Speaker Change: Mark as I believe previously includes our payments revenue asphalt coupon, 5% FX conversion Pete.

Ofer Koren: So, the changes would happen within the coming quarters with future releases. You are correct that today, managed markets payments are going through the Global-E platform, acquiring accounts in the future, as indicated. It will be done directly with Shopify. This will have a certain impact on the economics going forward. Once acquiring is moved into a Shopify payment, we will net it out on our side and it will not be recorded as part of our revenue.

Chris Zhang: So.

Chris Zhang: The changes would have been within the coming quarters with future releases are released.

Chris Zhang: You are correct that today.

Chris Zhang: And then as markets payment outgoing globally.

Chris Zhang: The.

Chris Zhang: Platform.

Chris Zhang: Acquiring accounts.

In the future as indicated.

Chris Zhang: Hmm.

Chris Zhang: It will be done.

Chris Zhang: Directly with Shopify this will have.

Chris Zhang: A certain impact.

Chris Zhang: On the other economics going forward.

Chris Zhang: Well.

Chris Zhang: Once the acquiring has moved into our Shelby site payments.

Chris Zhang: Net it out.

Chris Zhang: On our side.

Chris Zhang: And it will not be recorded as part of our revenue.

Ofer Koren: Further explanation of that I will pass it to Ofer, he can share some more. Yeah, so in terms of In terms of, as Nir explained, there are certain elements, such as payments, which is the main one, but there are some others, will be handled by Shopify. Once this goes live, we will not record those elements as revenue. However, we do aim at seeing a positive impact on our sales and marketing expense on the other side, where we record. the rev share component. And overall, we expect this model to have a limited impact on the bottom line.

Chris Zhang: So the total explanation that I would.

Chris Zhang: Australia.

Chris Zhang: You can show some more.

Chris Zhang: Yes, so in terms of.

Nir: In terms of as Nir explained.

Nir: Explained there are certain elements such as payment, which is the main one but there are some others will be handled by shopify.

Nir: Once.

Nir: This goes live.

Nir: We will not record those.

Nir: Elements as revenue.

Nir: However, we do aim it.

Nir: Being a positive.

Nir: Impact on our sales and marketing expense on the other side, where we record.

Nir: The the Rev share component.

Nir: And overall, we expect.

Nir: This model to have a limited impact on the bottom line.

Unknown Executive: It opens up a massive opportunity to further scale up that option and to increase GMV once it's live and it's pushed forward, so that's the way we view it. All right. Really appreciate the answer. That's really helpful.

Nir: It opens up.

Nir: And massive opportunity to further scale up that adoption and to increase DMV.

Nir: One site live and it's pushed forward. So that's that's the way we view it.

Nir: Okay.

Nir: Alright, I appreciate the answer that's really helpful.

Unknown Executive: The second question is around, potentially, I apologize for the a little loaded question. It's around the margin trajectory throughout the rest of the year. It looks like the second quarter, even the margin is a bit light, and that implies an expansion in the second half, even the margin.

Nir: My second question is around.

Nir: Potentially I apologize for that a level loaded question is around the margin.

Nir: Throughout the rest of the year it looks like the second quarter EBITDA margin is a bit light and that implies.

Nir: The expansion in the second half EBITDA margin.

Ofer Koren: Part of that is probably within your normal seasonal patterns, especially for the back half of the year, but would you maybe be able to talk about some of the drivers of even the margin, your investment levels you're seeing for the rest of the year? Also, in terms of free cash flow, the margin seems a bit light, but there's also some seasonal patterns, and do you still expect very strong free cash flow conversion from your EBITDA this year? Thank you. Sure, thank you for the question. Regarding margins, on the gross margin side, we expect gross margins to be slightly higher compared to Q1 for the remaining of the year, mainly due to mix of revenues and also some minor efficiencies that we expect to achieve.

Nir: And part of that is probably but anger normal seasonal patterns, especially for the back half of the year, but.

Nir: Could you maybe be able to talk about some of the drivers of the EBIT margin in your investment levels you are seeing for the rest of the year.

Nir: And also.

Nir: In terms of free cash flow.

Nir: The margin seems a bit light by Boston. This awesome seems about patterns and do you still expect very strong free cash flow conversion from EBITDA. This year. Thank you.

Nir: Yes.

Speaker Change: Sure. Thank you for the question regarding margins.

Speaker Change: On the gross margin side, we expect gross margins to.

Speaker Change: To be slightly higher compared to Q1 for the remaining of the year.

Speaker Change: Mainly due to mix of our.

Speaker Change: Our revenues and also some.

Speaker Change: Minor efficiencies that we expect to achieve.

Ofer Koren: And regarding adjusted EBITDA, we don't see any notable change in OPEX. We continue to control costs and progress according to our budget. As you mentioned, we do have seasonality, so naturally adjusted EBITDA margins are expected to be higher in the back half of the year and more specifically, definitely in Q4.

Speaker Change: And regarding adjusted EBITDA, we don't see any notable.

Speaker Change: Changing in Opex, we continue to control cost.

Speaker Change: And progress.

Speaker Change: According to our budget.

Speaker Change: As you mentioned, we do have seasonality. So naturally adjusted EBITDA margins are expected to be higher in the back half of the year and more specifically.

Speaker Change: Definitely in Q4.

Ofer Koren: In terms of free cash flow, nothing material has changed here and we do expect adjusted EBITDA to convert very nicely into free cash flow and to be at least, the free cash flow is expected to be at least at adjusted EBITDA level and probably...

Speaker Change: In terms of.

Speaker Change: Free cash flow and nothing material has changed here and we do expect adjusted EBITDA to convert very nicely into free cash flow to be at least the free cash flow is expected to be at least at the adjusted EBITDA level and probably higher.

Samad Samana: Your next question comes from Samad Samana with Jeffreys. Your line is now open. Hi, good morning. Thank you for taking my question.

Speaker Change: Your next question comes from Samad Samana with Jefferies. Your line is now open.

Speaker Change: Okay.

Speaker Change: Good morning, and thank you for taking my question, maybe first just look I know the shopping my question has been asked but if we could maybe get a little bit more precise statement on what has changed in terms of the commercial agreement given the equity that you gave them pre IPO and now not having exclusivity I guess.

Unknown Executive: Maybe first, just look, I know the Shopify question has been asked, but if we could maybe get a little bit more of a precise statement on what has changed in terms of the commercial agreement, given the equity that you gave them pre-IPO and now not having exclusivity, I guess in the Revised Agreement tilts in your favor, right, in terms of will the unit economics look better? Just help us understand, other than the extended duration, what the benefit is from Global-E's perspective of the revised agreement, and then I have one follow-up. Sure, then starting with the question you asked, we do have a long-standing partnership with Shopify.

Speaker Change: What.

Speaker Change: The revised agreement.

Speaker Change: Favre right in terms of what the unit economics look better just help us understand.

Speaker Change: Other than the extended duration, what the benefit is from global lease perspective, the revised agreement and then I have one follow up.

Speaker Change: Sure then starting with you.

Speaker Change: With a question.

Speaker Change: We do have a long.

Speaker Change: Long standing partnership with Shopify as you indicated folios ago reallocated.

Amir Schlachet: As you indicated, four years ago, we allocated warrants in the company. Most of them would actually finish to amortize this quarter, and the rest of it would be by the end of the year, or early Q2, 2026. As for the change that is happening now, this new free agreement is actually transitioning us from an exclusive to a preferred provider. As part of it, Shopify gets more flexibility for its mergers, but on the other hand, Global-E gets first an exclusive feature set that would not be open to other providers, as well as improved commercials. You should expect it to be reflected over time in a reduction in our S&M, in the back part of the domain.

Speaker Change: We allocated a warranty company.

Speaker Change: Most of them would actually with.

Speaker Change: Actually finished or amortize this quarter and the rest of it would be by that by the end of the or early Q2 2026.

Speaker Change: As for the change that is happening now.

Speaker Change: This new three year agreement the agreement is actually.

Speaker Change: Transitioning us from an exclusive to a preferred.

Speaker Change: Provider as part of the shop, if I get more flexibility for weeks merchant.

Speaker Change: On the other hand globally get first.

Speaker Change: And exclusive feature sets that would not be open to other.

Speaker Change: Two other two other providers as well.

Speaker Change: Improved commercial footwear.

Speaker Change: Should expect that a you should expect.

Speaker Change: We should expect it to be reflected in that.

Speaker Change: Overtime and a reduction in <unk> in the backpack of deal may be careful.

Samad Samana: Thank you.

Speaker Change: Okay.

Speaker Change: I understand.

Ofer Koren: If we step back, Ofer, on the guidance, How much of it is the reiteration is based on not seeing a change in trends versus, um, I guess, did you guys debate maybe suspending guidance given some of the unknowns? Just help us walk through the, the process of determining that you guys could maintain the guidance and, um, and any potential conservatism that you've embedded in there or outlook that things may get, may change down the road, just again, help us understand the guidance . Yeah, thanks Samad. So as we discussed in the prepared remarks, we do see a greater uncertainty Geopolitical, and the Macro-Environment, with a lot of it coming out of the whole trade tariff dynamics.

Ofer Koren: I guess a follow up if we step back ofer on the guidance.

Ofer Koren: How much of it is the reiteration is based on not seeing a change in trend versus.

Ofer Koren: I guess did you guys debate may be spending guidance given some of the unknowns just help us walk through the process.

Ofer Koren: Determining that you guys can maintain the guidance and.

Ofer Koren: And any potential conservatism that you've embedded in there or outlook that things may get may change down the road.

Ofer Koren: Help us understand the guidance.

Ofer Koren: Okay.

Ofer Koren: Yes, Thanks Ahmad Zamir so.

Ofer Koren: So as we discussed in the prepared remarks.

Ofer Koren: We do see a greater uncertainty in the geopolitical and macro environment.

Ofer Koren: We've.

Ofer Koren: A lot of it is coming out of the whole trade dynamics.

Ofer Koren: But as I said, when we looked at our forecast for the remainder of the year, we didn't identify any clear kind of directional trends in trading patterns. So despite the higher uncertainty, we believe that we can maintain our guidance for the full year, and that our performance at the end of the year will fall within that guidance.

Ofer Koren: Dynamics, but but as said when we looked at.

Our forecast for the remainder of the year, we didn't even.

Ofer Koren: By any measure.

Ofer Koren: Here kind of directional.

Ofer Koren: Trends in trading patterns.

Ofer Koren: So despite the higher uncertainty.

Ofer Koren: We believe that we can maintain our guidance for the full year and that the.

Ofer Koren: Our performance at the end of the year will fall within that guidance range.

Ofer Koren: Okay.

Andrew Bauch: Your next question comes from Andrew Bauch with Wells Fargo. Your line is now open. Morning, thanks for taking the question.

Speaker Change: Your next question comes from Andrew Bock with Wells Fargo. Your line is now open.

Andrew Bock: Good morning, Thanks for taking the question.

Unknown Executive: Maybe if I could ask around the top of funnel dynamics that you're seeing, I know that in the beginning of the year, we talked about, you know, some Hesitancy in launching new cross-border commerce experiences or relationships may have been put on hold because of the uncertainty in the market, and that's pretty intuitive. But I was wondering if anything has changed there pre- and post-Liberation Day, China pause, and when we could potentially see some of the complexity-driven demand stimulating top of funnel once again.

Maybe if I could ask around the top of funnel dynamics that youre seeing I know that in the beginning of the year, we talked about some.

Andrew Bock: Hesitancy in launching new cross border commerce experiences and relationships may have been put on hold because of the uncertainty in the market that's pretty intuitive, but I was wondering if anything has changed there pre and post liberation day China.

Andrew Bock: Pause.

Andrew Bock: And when we could potentially see some of the <unk>.

Andrew Bock: Complexity, driven demand stimulating top of funnel once again.

Nir Debbi: Hi, thank you for the question. We have seen a constant moving of merchants and prospects along the funnel. There was a slight hesitation for a few weeks once the turmoil started, but since then we have seen a movement of merchants back into launches and back moving towards signing within the stages of the funnel. As for the more complex solutions, we are expecting to launch within the coming weeks the first merchants that are going to use our 3B2C offering. We have seen demand for it from existing merchants, as well as new prospects, and as I said, the first are going to launch with it in the coming weeks.

Andrew Bock: Hi.

Speaker Change: Thank you for the question.

Speaker Change: We have seen constant move in.

Speaker Change: The merchants and prospects along the funnel.

Speaker Change: There was a slide presentation for a few weeks.

Speaker Change: Once once the turmoil has started but since then we have seen a movement of merchants back into.

Speaker Change: Back into launches in vertical and moving towards signing within the funnel looks good.

Speaker Change: Within the stages of the funnel.

Speaker Change: As far as the more complex.

Speaker Change: Solution.

Speaker Change: We are expecting to launch within the first within the coming weeks as first merchants that are going to use all three b to C offering.

Speaker Change: We have seen demand fully from existing merchants.

Speaker Change: As well as new prospects.

Speaker Change: And as I said, the first going to launch with us in the coming weeks this will enable them to well to well.

Unknown Executive: This will enable them to, I would say, enjoy a lower impact on the tariff due to the better offering. The complexities, and as we've seen it historically in Brexit and in other situations, actually drive merchants to look for solutions as they understand that they don't have enough flexibility within their own system. And we start to see that interest, I would say, trickling into our funnel. Got it.

Speaker Change: Enjoy a lower impact.

Speaker Change: <unk>.

Speaker Change: Due to the due to the due to the this is a better offering.

Speaker Change: The complexity.

Speaker Change: And as we've seen it historically.

Speaker Change: Brexit and in other situation actually drive merchants to look for solutions as they understand that they don't have enough flexibility within their own system and we start to see that interest.

Speaker Change: I would say trickling into our funnel.

Got it and then my follow up would be.

Ofer Koren: And then my follow-up would be, services yield came in a little bit light relative to our expectations. You know, we were thinking consistent with fourth quarter. How should we think we'd be thinking about services take rate through the remainder of the year? Is first quarter, you know, a good kind of modeling level for that line? Yeah, we do believe that the first quarter would be a good modeling benchmark. As we already mentioned in previous quarters, on a year-to-year comparison versus Q4, the loss of Ted Baker, which had a higher service fee take rate due to the demand generation services, weighs on the service fees growth.

Speaker Change: Services yield came in a little bit light relative to our expectations, we were thinking <unk>.

Speaker Change: Consistent with fourth quarter, how should we think be thinking about services take rate through the remainder of the year is first quarter.

Speaker Change: <unk> kind of modeling level for for that line.

Speaker Change: Yes, we do believe that the first.

Speaker Change: Quarter would be a good.

Speaker Change: Good modeling benchmark.

Speaker Change:

Speaker Change: As we already mentioned in previous.

Speaker Change: Previous quarter on a year to year comparison, not versus Q4 that the loss of <unk>.

Speaker Change: The Baker, which had a higher service fee take rate due to the demand generation services.

Speaker Change: On the service fee growth.

Ofer Koren: And in addition, and this also applies directly to your question, there is a higher share of larger merchants, GMP, in the mix. It's also some domestic activity with merchants such as Harrods and Manchester United at lower take rates. So this sort of impacts the mix. We also had certain cases due to the changes with tariffs of extra duties that were charged after parcels were shipped, which we decided to absorb in the interest of merchant relationships. So this is also something that we've experienced.

Speaker Change: And in addition in diesel so clients directly to your question. There is a higher share of larger merchants GNP and the mix.

Speaker Change: It's driven by the large merchant on boarding in the back half of 'twenty four.

Speaker Change: <unk>.

Speaker Change: Also among those larger merchant there is also some domestic activity with merchants, such as payroll and Manchester United.

Speaker Change: Lower take rates, so this sort of impact the mix.

Speaker Change: We also had certain cases due to the changes with tariffs of extra duties that were charge after <unk>.

Speaker Change: Parcels where ship.

Speaker Change: Which we decided to absorb in the interest of merchant relationships. So it is also something that we've experienced.

Scott Berg: But all in all, I think that, as I mentioned, we do expect the service fee take rate to remain at the current levels for the remaining Your next question comes from Scott Berg with Needham. Your line is now open. Hi, everyone. Thanks for taking my questions. I wanted to follow up on a statement Amir had made around the de minimis impact or the change of the de minimis rule in the United States probably has largest impact on volumes coming into the United States. Can you help us handicap how much of that 12% of last year's GMV volume that came into the United States was from the de minimis rule?

Speaker Change: But all in all I.

Speaker Change: I think that as I mentioned, we do expect.

Speaker Change: Service fee take rate.

Speaker Change: To remain at the current levels for the remaining of the year.

Speaker Change: Your next question comes from Scott Berg with Needham. Your line is now open.

Scott Berg: Hi, Good morning, Thanks for taking my questions I wanted to follow up on the statement of Mir had made around the de.

Scott Berg: De Minimis impact of the change of the de Minimis rule in the United States, probably the largest impact on volumes coming into the United States can you help us handicap, how much of that 12% of last year's GMP volumes that came into the United States was from the de Minimis rule or just trying to understand if that's just a gift.

Unknown Executive: Or just trying to understand if that's a significant or small portion.

Scott Berg: Or a small portion.

Scott Berg: Yeah.

Unknown Executive: Hey, Scott, it's Neil. Yes, indeed, inbound into the US reflects around 12% of our activity. Within it, around 30% of it is goods that are country of origin, China and Hong Kong. The vast majority of it is within the 800, so it is affected. However, if you compile it all, we have around 3% that are affected. We've seen different kinds of effects on different merchants and the way the consumer behaves. So overall, they have seen a higher impact in particular, but if you look at the broader base, the impact so far was relatively light. Got it.

Scott Berg: Hey, Scott it's Neal.

Scott Berg: Yes, indeed inbound into the U S with flex around 12%.

Scott Berg: Our activity within it.

Scott Berg: 130% of it is a good fit to our country of origin in China and Hong Kong.

Scott Berg: The vast majority of the month.

Scott Berg: Amongst the vast majority of it is within the 800, so it is affected.

Scott Berg: However.

Scott Berg: However.

Scott Berg: If you combine it all we have around 3%.

Scott Berg: <unk>.

Scott Berg: We've seen different kind of effects on different merchants in the way and the way the consumer behaves the overhaul.

Scott Berg: Yeah.

Scott Berg: <unk> seen a higher impact in particular, but if you look at the broader base.

Scott Berg: The impact so far was relatively light.

Scott Berg: Okay.

Unknown Executive: Very helpful.

Scott Berg: Alright got it very helpful and then when.

Unknown Executive: And then, when we think of the change in the Shopify kind of partnership going forward, especially on the OneP side, I guess, help us understand the statement on the ability to maybe accelerate, you know, the impact and growth in that business with new merchants there. Obviously, we heard about the change in the commercial side, but I guess trying to understand over the next year or two what's going to be done to maybe help accelerate the number of merchants that are actually using the Managed Markets program. Yes, the way we see it in Shopify as well, and this is the reason we are transitioning the solution and the future releases would and are taking a lot of resources in order to provide it.

Scott Berg: When we think of the change in the Shopify.

Scott Berg: Partnerships going forward, especially on the <unk> side I guess.

Scott Berg: Help us understand the statement on the ability to maybe accelerates.

Scott Berg: Yes.

Scott Berg: Impacting growth in that business with new merchants. There obviously, we heard about the change in the commercial side, but I guess I'm trying to understand over the next year or two what's going to be done to maybe help accelerate the number of merchants that are actually using managed markets program.

Yes, the way, we see it in shopify as well and this is the reason we are transitioning.

Scott Berg: Solution in the future releases wood.

Scott Berg: And are taking a lot of resources in order to provide it we are looking for a functionality that would make it more seamless for merchants and will align the process more closely with our domestic.

Unknown Executive: We are looking for a functionality that would make it more seamless for merchants and will align the process more closely with our domestic store. And once we are able to provide and I think we spoke about payments and reconciliation and settlement as one of those changes, it will allow a much broader adoption and we expect to see many more merchants using it over time.

Scott Berg: With our domestic store and once we are able to provide that and I think we spoke about payments.

Scott Berg: And a reconciliation in settlement is one of the is one of those changes it will allow a much more of adoption and we expect.

Scott Berg: And we expect to see many more merchants using it to overtime.

Brent Bracelin: Your next question comes from Brent Bracelin with Piper Sandler. Your line is now open. Thank you for taking the question here.

Speaker Change: Your next question comes from Brent bracelet with Piper Sandler Your line is now open.

Brent: Thank you for taking the question here I wanted to go back to the guide here, maybe with a slightly different.

Ofer Koren: I wanted to go back to the guide here, maybe with a slightly different tact. You onboarded some really large customers in fourth quarter of last year. It's a pretty big step up in volumes and creates a tougher compare. Your second half outlook here implies growth can remain here in this 30 percent range for GMV growth. What gives you confidence you can hold that even with tougher compares in a more challenging environment? Is there something specific in the funnel where you have the line of sight and visibility to new large merchants coming on the platform? Just walking through Victoria Secrets, Harrods, Manchester, all volume coming on in Q4 last year, creating a tougher compare this year, and why you think you can continue to have outsized growth in Q4 this year.

Speaker Change: Pat you on boarded some really large customers.

Speaker Change: In fourth quarter of last year, it's a pretty big step up in volumes and creates a tougher compare your second half outlook here implies growth can remain here in this 30% range for GMP growth.

Speaker Change: What gives you confidence you can hold that even with tougher compares in a more challenging environment is there something specific in the funnel, where you you have good line of sight and visibility to new large merchants coming onto the platform just just walking through.

Speaker Change: Tori Secrets, Harrods van Chester oil volume coming on in Q4 of last year, creating a tougher compare this year and why you think you continue to have outsized growth in Q4 this year. Thanks.

Ofer Koren: Thanks.

Ofer Koren: Yes, thank you for the question, Brent. I think that, as we've mentioned previously, why we don't have any, you know, any, any Expected launches with the size of an herald. We do have a very robust project schedule this year and we expect to see, we have seen launches as we mentioned, but we expect to see many more launches throughout the year. It's less concentrated, but still we have very nice-sized merchants, including a few large ones that are expected to launch in the next few months. So, you know, as we've mentioned, in terms of project launches, things have gone more or less according to schedule, in terms of the way that the tariff turmoil impacts volumes.

Speaker Change: Yes. Thank you for the question Brian.

Speaker Change: I think that.

Speaker Change: As we've mentioned previously while we don't have.

Speaker Change: And the.

Speaker Change: Any.

Speaker Change: Expected launches with the size of an <unk>.

Speaker Change: We do have a very.

Speaker Change: Robust.

Speaker Change: Our project schedule this year and we expect to see we have seen launches as we mentioned, but we expect to see many more.

Speaker Change: Launches throughout the year.

Speaker Change: It's less concentrated but still we have.

Very nice sized merchants, including the fuel.

Speaker Change: Large ones.

Speaker Change: That are expected.

Speaker Change: To launch in the next few months.

Speaker Change: So as we've mentioned in terms of.

Speaker Change: Of project launches things have gone more or less according to schedule in terms of.

Speaker Change: The way that them.

Speaker Change: Tariff turmoil.

Ofer Koren: As we mentioned, we haven't seen any directional, clear directions there, so that's the reason we have not changed or maintained our guidance for the Helpful color there.

Speaker Change: Our impact volumes as we mentioned, we haven't seen any direction clear direction there.

Speaker Change: So.

Speaker Change: Those that that's the reason we have not chain.

Speaker Change: <unk> maintained our guidance for the full year.

Speaker Change: Helpful color, there and then Nir for you on three B to C.

Nir Debbi: And then Nir, for you on 3b2c, any way you can frame the volume of interest? A lot of change happening, may or may not unfold as change, but can you quantify merchant interest in 3b2c? I know it's new, but help us understand what you're seeing there.

Speaker Change: You can frame the volume of interest a lot of change happening may or may not unfold. This change, but can you quantify.

Speaker Change: Merchant interest in three B to C. I know its new but help us understand what you're seeing there. Thanks.

Nir Debbi: Thanks. Hi, Brent. We do see high interest in the solution. However, we are looking at what would be the impact now with the announcement that is taking effect just today with a reduction of tariffs on China, because it does change economics for certain merchants on the attractivity of the model. But in general, we do believe that it's a significant opportunity. As I said, we have merchants already in project stage that would launch within weeks on the 3B2C solution. So the solution is compelling and does get market traction.

Sure.

Speaker Change: Hi, Brent we do see high interest in the solution.

Speaker Change: However.

Speaker Change: We are looking at what would be the impact now with the announcement.

Speaker Change: He's taking effect just today with a reduction of tariffs on China, because it does change the economics for certain merchants on that tour activity of the model, but in general we do believe that it is a significant opportunity as I said, we have merchants already in project stage that Woodlawn.

Speaker Change: Within weeks.

Speaker Change: Because the solution. So the solution is compelling and does gain market traction.

Mark Zgutowicz: Your next question comes from Mark Zgutowicz with Benchmark. Your line is now open. Thank you.

Speaker Change: Your next question comes from Mark <unk> with benchmark. Your line is now open.

Speaker Change: Thank you just as it relates to the new shops.

Nir Debbi: Just as it relates to the new Shopify commercial agreement, I'm just curious, if you talk about 1P exclusivity versus the 3P, does the dashboard for Shopify merchants look any different? Going forward, like, do they see, you know, in terms of Options for Cross-Border Transactions. Are there more options? Just trying to get a sense of that.

Speaker Change: Commercial agreement.

Speaker Change: I'm just curious if you can talk about one P exclusivity versus the <unk>.

Speaker Change: Dashboard for Shopify merchants look any different.

Speaker Change: Going forward. Thank you they see in terms of.

Speaker Change: Options for cross border transactions is there are there more options just trying to get a sense of that.

Nir Debbi: And then in terms of its future contribution to GMB, just trying to get a sense of how you see that trending. Obviously, Shopify is moving more into the enterprise side. And I'm just curious if you're seeing a better connection to those enterprise-type merchants that they're bringing on their platform. Thanks.

Speaker Change: And then in terms of its future contribution to GMP.

Speaker Change: Just trying to get a sense of how you see that trending.

Speaker Change: Obviously shopify is moving more into the enterprise side.

Speaker Change: Just curious if.

Speaker Change: Youre seeing.

Speaker Change: A better connection to those enterprise type merchants that they're bringing on their platform.

Nir Debbi: Hi Mark, it's Nir. First, on the 1P side, the dashboard and what the customer actually sees, will not see material change because today their dashboard and the management is coming out of the Shopify admin, it will stay this way. Some elements of friction that around the payment settlement side would actually be more seamless for them as they will be reflected within Shopify the same as their domestic operations. So instead, they would see an improvement. In terms of 3P and the effect for it, if you combine it with growth in enterprise merchants on Shopify, this is actually a positive development for Global-E.

Neil: Hi, Mark it's Neil.

Speaker Change: First on the one P side.

Speaker Change: The dashboard and what's the customer actually sees and we will not see a material change because today the dashboards and the management is coming out of the Shopify admin. It will stay this way at some elemental friction.

Speaker Change: There is a payment settlement side would actually be more seamless for them as they will be reflected and we then Shelby play the same as our domestic operations, So and said that they would see an improvement.

Speaker Change: In terms of <unk> fleet.

Speaker Change: If you are if you combine it with our growth in enterprise merchants on Shopify. This is actually a positive development for globally globally was built on the <unk> side out of our device merchant, we have the largest and a very fast growing gross to offset.

Nir Debbi: Global-E was built on the 3P side out of our enterprise merchants. We have the largest and a very fast-growing roster of large enterprise brands across luxury and non-luxury retail brands, etc. So I believe that once those clients continue and come to Shopify, with our great track record on Shopify and the development of our integration into Shopify, I believe this would be good for us.

Speaker Change: Large enterprise brands across luxury and non luxury retail brands et cetera. So I believe that one of those clients continuing to come to shopify with a great track record on Shelby plan. The development of our integration into Shopify I believe this would that would be would be good for us.

Speaker Change: Yeah.

Maddy Schrage: Your next question comes from Maddy Schrage with KeyBank. Your line is now open. Hey guys, thanks for taking my question.

Speaker Change: Your next question comes from Matti shrank with Keybanc. Your line is now open.

Matti Shrank: Hey, guys. Thanks for taking my question I just was wondering if you can hit on the model impacts that you expect from maybe a merchant taking the three b to C solution versus going the multi local about thanks.

Nir Debbi: I just was wondering if you can hit on the model impacts that you expect from maybe a merchant taking the 3B to C solution versus going the multi-local route. Hi Mary, the main difference is actually the amount of effort that a merchant needs to invest in order to roll out the domestic operations, as well as the economics, not on the unit level, but the economics of coming out of the overhead that comes with a local operation. And so the reason that we believe that 3B2C would take a nice portion is the same as what we see today on the multi-local offering.

Speaker Change: And that is the main difference.

Speaker Change: <unk> is actually the amount of effort.

Speaker Change: A merchant.

Needs to invest in order to rollout.

Speaker Change: The domestic operation.

Speaker Change: As well as economics and not on the unit level.

Speaker Change: The economics of it.

Speaker Change: And coming out of the overhead that comes with a local operation.

Speaker Change: And the reason that we believe that three way to see it would take a nice portion is the same as what we see today.

Speaker Change: And on the multi local offering.

Nir Debbi: It is good for a certain size of merchant, for a certain kind of SKU base that you have, because domestic operation across multiple locales is a very expensive setup to do. Not only on the registration and accounting, which is the most simple part, but on the domestic setup with the 3PL, logistics, payment providers, etc. And that is being easily solved with 3B2C, where Global-E takes all the heavy lifting and makes it only a registration and accounting setup for the brand. And so we do believe that some merchants will decide to go fully local, and this is where a multi-local would be a good solution, and some merchants would opt for the 3B2C according to their own specific parameters.

Speaker Change: It is good for a certain size of merchants for a certain kind of SKU base that you have because domestic operation across multiple oncology is a very expensive setup to do.

Speaker Change: Not only on our registered legislation and accounting, which is the most important part but on the domestic setup with the three APL logistics payment provider et cetera, and that is being easily sold will be freely to field globally. It takes all the heavy lifting and makes it only.

Speaker Change: Registration.

Speaker Change: And accounting setup for the brand. So we do believe that some merchants will decide to go fully local and this is where our multi local would be a good solution and some merchants it would not pose a threat to see according to their own specific parameters.

Unknown Executive: Got it.

Speaker Change: Got it and just a quick follow up I'm wondering if you guys could give an update to your border free dot com launch and wondering how things are tracking versus expectations and if there's anything remaining to build out on that product. Thanks.

Unknown Executive: And just a quick follow up.

Nir Debbi: I'm wondering if you guys could give an update to your borderfree.com launch. I'm wondering how things are tracking versus expectations, and if there's anything remaining to build out on that product thing. So we are very happy with the progress of borderfree.com since we launched it in Q4 of last year. We continue to see increased adoption of merchants to the border-free platform. In terms of the contributions that border-free yields for the merchants, we see a continuous improvement. I think that just when we discussed in the investor day, we managed at that time to hit around 2.5% to almost 3% contribution out of borderfree.com to merchants using that service.

Speaker Change: So we are very happy with our progress border free those Cong since we launched it in Q4 last year.

Speaker Change: We continue to see increased adoption of merchants.

Speaker Change: Towards the border free.

Speaker Change: Platform.

Speaker Change: In terms of.

Speaker Change: Contributions that border free.

Speaker Change: Yields for the merchants, we see a continuous improvement I think that just when we're discussing the investor day.

Speaker Change: We managed at the time to heat around two and a half at almost 3% contribution.

Speaker Change: Out of border free Dot com to merchants using that service today, we are already over 4% that is of contributions that is generated by trophy coming out of the.

Nir Debbi: Today, we are already over 4% of contributions that is generated by traffic coming out of borderfree.com. As we continue to evolve and we have a lot more to do in order to bring that solution into where we want it to be, we expect it to continue and increase and cross the 5% mark. And long term, we do believe that the solution would create for the participating merchants anything between 5% to 10% on average.

Speaker Change: A border free dot com as we continue to evolve and we have a lot more to do in order to bring that solution into where we wanted to be we expect it to continue and increase in cross the 5% Mark and long term, we do believe that the solution would create for the participating merchants anything with.

Speaker Change: 25% to 10% on average.

Koji Ikeda: Your next question comes from Koji Ikeda with Bank of America. Your line is now open. Yeah, hey, guys. Thanks for taking the questions. Apologies if this has been asked. I didn't jump in from a couple questions, but a couple calls here this morning.

Speaker Change: Your next question comes from <unk> with Bank of America. Your line is now open.

Speaker Change: Yeah, Hey, guys. Thanks for taking the questions apologies. If this has been asked I've been jumping from a couple of questions.

Speaker Change: Calls here this morning, but I did want to ask about the three BTC offering that was talked about in the press release can you talk a little bit more about that and how easy was it to formulate that at offering and was that a pull request from customers and how does this dynamic of the <unk> play into potential take rates going forward.

Nir Debbi: But I did want to ask about the 3B2C offering that was talked about in the press release. Can you talk a little bit more about that? And how easy was it to formulate that offering? And was that a pull request from customers? And how does this dynamic of the 3B2C play into potential take rates going forward? Basically, 3b2c helps merchants work in a challenging and a high-rate taxation environment. It allows them just to set up a legal entity within the destination markets without a local setup that involves bringing inventory and storing it in the market, integrating multiple solutions from carriage and payment into the market, which is heavy lifting, and enjoy importing on commercial basis with lower tariffs using the globally set up for the operations and for the payment, allowing them to enjoy the best of both worlds.

Speaker Change: Basically <unk> to see helps merchants.

Speaker Change: Work in.

Speaker Change: In a challenging.

Speaker Change: And a high rate.

<unk> environment. It allows them to set up a legal entity within the destination markets without a local setups that involved.

Speaker Change: Bringing inventory instilling in the market.

Speaker Change: Integrating multiple solutions from carriage and payments into the market, which is heavy lifting and enjoy importing on commercial basis.

Speaker Change: With lower total Leafs and using the globally set.

Speaker Change: Set up for operations and for the payment, allowing them to enjoy the best of both worlds.

Nir Debbi: It is a complex setup, so we can't explain it now in a very short term more than that, but it does have traction in the market, and this does help a certain group of clients as well as possible. Got it. Thank you.

Speaker Change: It is a complex setup. So we can't explain it now in a in a very in a very short.

Speaker Change: More than that but it does have traction in the market and this does help.

Speaker Change: Certain group of clients and as well prospect.

Speaker Change: Got it okay. Thank you and one thing I think a lot about with globally is two.

Nir Debbi: And one thing I think a lot about with Global-E is two fronts. One is potential effects to inbound tariffs in countries out there, but also inventory affected by tariffs for U.S. retailers and merchants that are sending product outbound from the U.S. Is there any way to think about how much GMV or maybe what percentage of customers that are U.S.-based that might have large inventories that might be affected by tariffs or how tariffs So at least on the export side, where we operate with U.S. brands, when they import into the market, yes, indeed, they are paying more tariffs, but when they export it with Global-E to consumers worldwide, they are actually able to reclaim the import duties.

Speaker Change: Two fronts, one is potential effects to inbound tariffs in countries out there, but also inventory.

Speaker Change: <unk> terrace floor for U S retailers and merchants that are sending product outbound from the U S is there any way to think about.

Speaker Change: How much <unk> or maybe what percentage of customers that are U S based that might have.

Speaker Change: Large inventories that might be affected by tariffs or tariffs playing to that thank you.

Speaker Change: So at least on the export side, where we operate with U S brand.

Speaker Change: Wednesday input into the market, yes, indeed, they are paying multiple leafs at Wednesday expertise with.

Speaker Change: With globally.

Speaker Change: To consumers worldwide are actually able to reclaim.

Speaker Change: The import the import duty.

Nir Debbi: So on this, it does give even an advantage for the cross-border sales versus the domestic sales. So on that, we see a positive. And on the general trading in the U.S., it does make trading slightly more expensive, but this is not part of our business with them.

Speaker Change: This it does give even an advantage.

Speaker Change: For the cross border sales versus the domestic sales, but ones that we see are positive.

Speaker Change: Sure.

Speaker Change: On the agenda are trading in the U S. It does make trading slightly slightly more expensive, but this is not part of the of our business with them.

Speaker Change: Thank you.

Matthew O'Neill: We will now take our final question from Matthew O'Neill with FT Partners. Your line is now open. Yeah, hi, thanks for the last one here.

Speaker Change: We will now take our final question from Matthew O'neill with Ft Partners. Your line is now open.

Speaker Change: Yeah, Hi, Thanks for the last one here, maybe just talk a little bit about how.

Nir Debbi: Maybe just talk a little bit about how everything that's going on sort of post-liberation day has impacted the demand side from merchants and thinking of things like their propensity to look to expand into demand generation and things like that. So some of the other service lines, has it kind of inspired them to, you know, accelerate any potential plans or are prospective customers kind of sitting on their hands a little bit until things quiet down? Thank you.

Speaker Change: Everything that's going on.

Liberation day has impacted the demand side from <unk>.

Speaker Change: James I'm thinking things like their propensity to look to expand into demand generation.

Speaker Change: And.

Speaker Change: And things like that so some of the other service lines as it kind of inspired them to.

Speaker Change: Great any potential plans are.

Speaker Change: Our perspective customers kind of sitting on their hands, a little bit until things quiet down. Thank you.

Amir Schlachet: Hi, Matt. As Ofer indicated, we did see mixed signals without any clear direction coming out of the turmoil on the tariff. On the one hand, it makes trading more complex. On the other hand, merchants try to find a way to grow within that environment. So some take an approach that is spending more, as you indicated, more demand generation in certain different geographies. On the other, you see merchants that are being affected adversely due to their mix of products. So as I said, we are slightly below the historical averages for same-store sales, but generally, we didn't see any clear indication yet about the long-term impact of the changes.

Speaker Change: Hey, Matt is offer indicated we did see mixed signal.

Speaker Change: Without any clear.

Speaker Change: Direction coming out of the turmoil on the <unk>.

Speaker Change: On the one hand, it makes the trading more plaque on the other hand merchants to try to find ways to grow.

Speaker Change: We think that the environmental some take take taken approach. It is spending more as you indicated more demand generation in certain different geographies.

Speaker Change: On the other you'll see merchants that are being affected adversely due to the mix of product. So as I said, we are slightly below.

Speaker Change: And the historical averages for same store sales, but generally we didn't see any clear indication yet about the long term impact of that change.

Unknown Executive: Thanks a lot.

Speaker Change: Thanks, a lot.

Speaker Change: Thanks, guys.

Unknown Executive: There are no further questions at this time.

Speaker Change: There are no further questions at this time I will now turn the call over to Amir for closing remarks.

Amir Schlachet: I will now turn the call over to Amir for closing remarks. So thank you, everyone, for your questions. And as I think is evident from all of them, there's a lot, lot of things happening here at Global-E.

Amir Flick: So thank you everyone for your questions and as I think is evident from.

Speaker Change: All of them, there's a lot a lot of things happening here at globally. So.

Amir Schlachet: So as we conclude yet another strong quarter here, I wanted to remind everyone that we're also celebrating our fourth anniversary as a public company. So I want to take this opportunity and on behalf of the really the entire team here at Global-E, I'd like to thank all of you here on the call, not just for joining us today, but also for your ongoing support along so many years.

Speaker Change: As we concluded another strong quarter here.

Speaker Change: I wanted to remind everyone that we're also celebrating our <unk> anniversary as a public company so I want to.

Take this opportunity and on behalf of the really the entire team here at globally.

Speaker Change: I'd like to thank all of you here on the call know just for joining US today, but also for your ongoing support along so many years.

Amir Schlachet: I would also like to take this opportunity to thank Erica and Mike of Sapphire IR, who have led our investor relations since our IPO. While this is not goodbye, as Alan steps into his new role, it's nevertheless an opportunity to thank both of you, as well as the rest of the Sapphire team, for your dedication and relentless work in helping us to bring the Global-E story in front of the market in the best and most professional way possible. I think it's clear to everyone that Global-E is only the beginning of its exciting journey. As we discussed at our investor day just this March in New York, we have a significant runway ahead of us as we continue on our journey to fulfill our mission to power better global e-commerce for brands worldwide.

Speaker Change: I would now like to take this opportunity to thank Eric and Mike.

Speaker Change: If our IR.

Our investor relations since our IPO.

Speaker Change: Well this is not goodbye.

Speaker Change: As Alan has definitely to his new role is nevertheless, an opportunity to thank both of you as well as the rest of this off our team for your dedication and relentless work and help us to bring the global story in front of the market and the best and most professional way possible.

Speaker Change: I think it's clear to everyone. It globally as only the beginning of its exciting journey.

Speaker Change: As we discussed at our Investor Day. This March in New York, We have a significant runway ahead of us as we continue on our journey to fulfill our mission to power better global ecommerce for brands worldwide.

Amir Schlachet: So we look forward to speaking with many of you during the quarter and updating you on our future earnings goals.

Speaker Change: So we look forward to speaking with many of you during the quarter and updating you on our future earnings calls and until then goodbye and take care.

Unknown Executive: And until then, goodbye and take care.

Speaker Change: Okay.

Unknown Executive: Ladies and gentlemen, this concludes the conference call for today. We thank you for participating and ask that you please disconnect.

Speaker Change: Ladies and gentlemen, this concludes your conference call for today, we thank you for participating and ask that you. Please disconnect your lines.

Speaker Change: Yes.

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