YOU | Q3 2025

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Overview

• Non-GAAP EPS of $0.29 beats by $0.03.

• Revenue of $229.2M (+15.5% Y/Y) beats by $4.4M.

KEY Takeaways

• Revenue grew about 15–16% year-over-year to $229 million.

• Total bookings climbed 14% to $260 million for the quarter and $690 million year-to-date.

• Active CLEAR+ members increased 7% year-over-year to 7.7 million, driven by airport enrollments and partnerships.

• Free cash flow was negative $53 million in Q3 due to the annual Amex payment, but underlying cash generation remains strong.

• Management raised full-year free cash flow guidance to at least $320 million, reflecting confidence despite higher eGate capex.

• The company returned about $61 million to shareholders via dividends in the first nine months and repurchased another $126 million of stock.

• CLEAR holds roughly $530 million in cash and securities and still has no debt.

• eGates are rolling out faster than expected — live in 10 airports now, expanding to 30 by year-end and nationwide in 2026.

• International expansion to 40-plus countries opens a new growth channel ahead of major travel events like the World Cup and 2028 Olympics.

• CLEAR1, the enterprise identity platform, delivered its best bookings quarter yet and is gaining traction in healthcare and workforce verification.

• The Epic integration embeds CLEAR1 into millions of healthcare records, showing scalable potential beyond airports.

NOTES

For Clear Secure (YOU), Q3 was a momentum-heavy quarter that resulted in steadily growing bookings, expanding margins, and continued growth for their second engine, CLEAR1, on top of the airport business.

Getting into the numbers, revenue for the quarter came in at about $229 million, up around 15–16% from a year ago.

Adjusted EBITDA was a little over $70 million with margins just above 30%, which is up quite a bit from the mid-20s last year.

Total bookings – which is basically revenue plus the change in deferred revenue and gives you a better sense of what’s really being sold – grew 14% to $260.1 million in the quarter and 14% to $690.2 million year-to-date.

Active CLEAR+ members were up about 7% year-over-year to roughly 7.7 million, driven by both in-airport signups and digital/partner channels.

Underneath that, the platform as a whole keeps getting denser: total cumulative enrollments are up 35% year over year and cumulative platform uses are up 27%, which tells you more people are using CLEAR more often across different use cases, not just signing up once and forgetting it.

With that, profitability continues to move in the right direction. Net income for the quarter was about $45 million, with a net margin just under 20%. And as mentioned earlier, adjusted EBITDA margins improved from 24.5% to 30.6% year over year, helped by operating leverage pretty much everywhere in the P&L.

Ambassador labor as a percentage of revenue is coming down as the company leans into automation, and G&A as a percentage of revenue improved by about 150 basis points year over year.

Management called out EnVe pods and eGates as big drivers of throughput and staffing efficiency: once the verification part of the process is automated, you can redeploy those same people into higher-value, higher-margin services like CLEAR Concierge instead of just staffing the lane.

For the first nine months of the year, operating cash flow was roughly $174 million and free cash flow was about $156 million, both up versus last year. But in Q3 specifically, free cash flow was negative about $53 million.

This happens every year, and it’s almost entirely because their annual payment to the credit card partner (American Express) – roughly $229 million – hits in the third quarter.

Outside of that one big check, the underlying cash generation of the business looks solid enough that management raised full-year 2025 free cash flow guidance from $310 million to at least $320 million, even after including the extra capex for the eGate rollout and factoring in some cash tax benefits from the One Big Beautiful Bill Act.

With that, they’re still returning a decent amount of that cash to shareholders. The regular quarterly dividend is $0.125 per share, and they paid about $35.6 million in regular dividends plus another $25.3 million in a special dividend during the first nine months of the year.

On top of dividends, they repurchased about $126 million of stock over the first nine months and still have about $126.5 million left on the current authorization. For a company with a strong net cash position, that combo of dividends plus buybacks gives you a nice “shareholder yield” on top of the consistent growth story.

Speaking of its net cash position, the balance sheet is still a key part of why this business feels relatively low-risk compared to a lot of other growthy subscription-based companies.

CLEAR has about $75.8 million of cash and $454.9 million of marketable securities on the balance sheet, plus $2.8 million of restricted cash, for total cash and investments of a little over $530 million.

There’s no traditional financial debt here. The biggest liabilities are deferred revenue (about $470 million of cash already collected for services they still owe you in the future) and other long-term items like lease obligations and the tax receivable agreement.

The TRA is still a meaningful obligation – CLEAR pays 85% of certain tax savings to legacy owners as units convert into Class A shares – but it’s tied to actual tax benefits realized over time rather than being a fixed-rate bond due on a specific date. Overall, this is still very much a net-cash, asset-light, subscription-heavy model.

Zooming out from the numbers, things at the airport are shifting from “we get you into a separate lane” to “we own the whole home-to-gate journey.” The recently rolled out eGates are central to that story.

The experience they’re going for is: you walk up, your identity is verified in roughly five seconds, and you’re into physical screening in under a minute. Early data is showing better throughput and higher lane-experience and NPS scores at airports where eGates are live, and CLEAR expects to go from 10 airports today to at least 30 by the end of the year, with a nationwide rollout into 2026.

The important subtext here is margin: once the hardware is in place, you can move ambassadors away from pure verification and into things like CLEAR Concierge, which is a paid, higher-touch service, or simply run more members through the same headcount.

Concierge itself is still in “early innings” but looks promising. It’s now live in 23 airports, and management said they’re seeing strong repeat use from people who try it — which tend to be families, travelers who want hand-holding in chaotic airports, and anyone who’s anxious about missing a flight.

The idea is that you can fully customize the journey — mobile enrollment, CLEAR+ lane access, concierge from curb to gate, TSA PreCheck bundling — and actually feel like your membership is a travel product, not just a line-skipping card.

That also ties into the marketing opportunity they keep talking about: two years ago CLEAR really had one core product; now they have a menu, and they admit most members don’t know the full range of benefits yet.

International is another quiet but important growth lever for the company. CLEAR+ is now open to travelers from 40-plus countries (Visa waiver markets), and management said enrollments from these travelers are already off to a strong start even before they’ve really done any marketing.

The long-term backdrop they see is a “travel boom”: World Cup in 2026, America250 events, LA Olympics in 2028, plus business travel continuing to normalize. Their view is that U.S. airport traffic could go from ~3 million people a day to 4 million by 2030, and they want CLEAR to be part of making U.S. travel infrastructure “sparkle” relative to places like Tokyo or Singapore.

In that context, they frame CLEAR as a public-private partner to TSA, FAA, airports, and airlines — especially relevant with all the recent headlines around TSA staffing and government budget issues. Even with that noise, they pointed out that October traffic was up about 4% year over year, so the demand side still looks healthy.

The other big pillar of the growth story is CLEAR1, the enterprise identity platform. This is their B2B push into healthcare and workforce identity, and it had its best bookings quarter yet (excluding the one-off Health Pass spike back in 2022).

In healthcare, CLEAR is now the “trusted identity layer” for CMS’s Health Tech Ecosystem Initiative, and more than 60 companies have signed the CMS pledge. CLEAR already has contracts with over 20% of those participants, which is a nice early signal that this isn’t just a press-release partnership.

The Epic integration is a good example of how this could scale: health systems that use Epic can turn on CLEAR1 inside MyChart, giving them identity verification for millions of patient records without a ton of work.

On the workforce side, CLEAR1 is being used for everything from pre-hire verification to account recovery and privileged-access workflows. Management made it clear they’re starting to see cross-sell and upsell as customers add more use cases over time.

All in all, this quarter reinforces the idea that CLEAR is evolving from a “nice-to-have airport perk” into a broader identity and travel-infrastructure business. With its net-cash balance sheet, bookings growth in the low-teens, expanding margins, and well-covered dividends, Clear Secure still seems to check a lot of boxes for investors.

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