Earnings call transcript: Global E Q2 2025 misses EPS expectations

Global E Online Ltd (GLBE) reported its financial results for the second quarter of 2025, revealing a significant earnings per share (EPS) miss compared to analysts’ forecasts. The company posted an EPS of -$0.13, falling short of the anticipated $0.03, marking a surprising -533.33% deviation. Despite this, revenue exceeded expectations, reaching $214.9 million against a forecast of $207.87 million. The mixed results led to a pre-market stock decline of 9.92%, with shares trading at $30.60, down from $33.97. According to InvestingPro analysis, the company’s current valuation suggests it may be undervalued, with analysts maintaining a strong buy consensus and setting price targets up to $64.

Key Takeaways

• EPS fell significantly below forecasts, with a -533.33% surprise.
• Revenue surpassed expectations by 3.38%, hitting $214.9 million.
• Stock dropped 9.92% in pre-market trading following the earnings release.
• Strong growth in U.S. market and expansion in APAC region noted.
• Acquisition of ReturnGo aims to enhance AI-driven return solutions.

Company Performance

In Q2 2025, Global E reported a robust 34% year-over-year increase in Gross Merchandise Volume (GMV), totaling $1.45 billion. Total revenue grew by 28% compared to the same quarter last year, maintaining the company’s impressive 5-year revenue CAGR of 63%. The company achieved a net profit of $10.5 million, a significant turnaround from a net loss of $22.4 million in Q2 2024. The company’s strategic focus on expanding its presence in the U.S. and APAC regions contributed to this performance. InvestingPro data reveals the company maintains a healthy financial position with a current ratio of 2.57, indicating strong liquidity to support its expansion plans.

Financial Highlights

• Revenue: $214.9 million, up 28% YoY
• Earnings per share: -$0.13, compared to a forecast of $0.03
• Adjusted Gross Profit: $99.9 million, up 34% YoY
• Adjusted EBITDA: $38.5 million, up 23% YoY
• Net Profit: $10.5 million, compared to a net loss of $22.4 million in Q2 2024

Earnings vs. Forecast

Global E’s EPS of -$0.13 missed the forecasted $0.03, resulting in a substantial negative surprise of -533.33%. However, the company’s revenue of $214.9 million exceeded expectations by 3.38%. This mixed performance reflects the company’s ongoing challenges in achieving profitability while successfully growing its top line.

Market Reaction

Following the earnings release, Global E’s stock experienced a sharp decline of 9.92% in pre-market trading, with shares priced at $30.60. This movement contrasts with the company’s 52-week high of $63.69 and low of $26.64, indicating investor concerns over the earnings miss despite positive revenue growth. InvestingPro subscribers have access to exclusive insights showing the company holds more cash than debt on its balance sheet and maintains a "GOOD" overall financial health score of 2.55 out of 5, with particularly strong ratings in growth and cash flow metrics. Get access to 10+ additional ProTips and comprehensive financial analysis through the Pro Research Report.

Outlook & Guidance

Looking ahead, Global E projects Q3 2025 GMV to range between $1.455 billion and $1.495 billion, with revenue guidance set between $214 million and $221 million. For the full year 2025, the company anticipates GMV between $6.22 billion and $6.52 billion, and revenue between $921.5 million and $971.5 million. The company expects to achieve GAAP profitability for the full year, aligning with InvestingPro analysts’ forecasts of positive earnings and continued sales growth. The company’s revenue is expected to grow by 26% in 2025, supported by its strong market position and expanding global presence.

Executive Commentary

CEO Amir Sallakat stated, "We continue to see tremendous opportunity to add value for our merchants, drive growth, and increase free cash flow." CFO Ofer Korin added, "Despite the continuous high level of uncertainty, trading volumes remained resilient in the second quarter."

Risks and Challenges

• Potential impacts from changes in de minimis exemptions could affect cross-border trade.
• Ongoing tariff uncertainties may impact global trading patterns.
• Competitive pressures in the e-commerce sector remain high.
• Economic conditions in key markets could affect consumer spending.

Q&A

During the earnings call, analysts inquired about the impact of the ReturnGo acquisition, to which executives responded that it is expected to have a slight positive revenue impact. Questions also focused on the company’s strategic partnership with Shopify and the development of managed markets. Executives emphasized their commitment to strengthening these areas to drive future growth.

Full transcript - Global-E Online Ltd (GLBE) Q2 2025:

Conference Operator: Good morning. Welcome to the Global E Second Quarter twenty twenty five Earnings Conference 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 introduction, I will now turn the call over to Alan Katz, Investor Relations. Please go ahead.

Alan Katz, Investor Relations, Global E: Thank you, and good morning, everyone. With me on the call today are Amir Sallakat, Co Founder and Chief Executive Officer Ofer Korin, Chief Financial Officer and Nare Debbie, Co Founder and President. Amir will begin with a review of the business results for the second quarter twenty twenty five. Ulfar will then review the financial results of the second quarter followed by the company’s outlook for the third quarter and full year 2025. We’ll then open the call for questions.

Certain statements we make today may constitute forward looking statements and information within the meaning of the Safe Harbor provisions of The U. S. Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact, including and without limitation to statements regarding our future results of operations and financial position, growth strategy and plan and objectives of management for future operations, including onboarding new merchants, expanding our offerings and introducing and integrating new solutions are forward looking statements. These forward looking statements reflect our current views with respect to future events and are not a guarantee of future performance, outlook.

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 annual report on Form 20 F filed with the SEC on 03/27/2025, and other documents filed with or furnished to the SEC. 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 statements. Except as required by applicable law, we undertake 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 statements are made or to reflect the occurrence of unanticipated events. Please refer to our press release issued today, 08/13/2025, for additional information.

In addition, certain metrics we will 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 will 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. For more information on these non GAAP financial measures, please see the reconciliation tables provided 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, Co Founder and CEO. Amir, please go ahead.

Amir Sallakat, Co-Founder and Chief Executive Officer, Global E: Thanks, Alan. I would like to start by welcoming everyone to our second quarterly earnings call of 2025. We achieved another quarter of strong results coming in above the high end of our GMV and revenue guidance ranges and at the top end of our EBITDA guidance range. We are proud of the entire Global E team for their continued great execution throughout the quarter, which enabled these strong results. While we continue to see some uncertainty around duty tariffs and their potential adverse impact on global trade in the back half of the year, we nevertheless believe that our strong GMV and top line growth to date, together with our raised guidance for the year, demonstrate the resilience of our business model and the great value that merchants see in our services.

We finished Q2 with GMV of $1,450,000,000 up 34% year over year, and with revenues of almost $215,000,000 up 28% year over year. In terms of profit, our adjusted gross profit for Q2 was just shy of $100,000,000 up 24% from last year. And quarterly adjusted EBITDA was $38,500,000 up 23% compared to the same quarter last year, resulting in a 17.9% margin. In terms of our financial performance, I also want to highlight that this quarter we achieved another important milestone in our journey as a company, that of sustainable GAAP profitability, with the net profit in the quarter coming in at $10,500,000 compared to a net loss of $22,400,000 in the same quarter of last year. The amortization of the majority of the Shopify warrants is now done, with the rest expected to be fully amortized by early twenty twenty six.

As such, we expect to be GAAP profitable moving forward in subsequent quarters and for 2025 to be our first full year of GAAP profitability, a testament to the strength and durability of our business model, as well as our relentless focus on execution and operational efficiency. Looking at the broader business performance metrics, we have seen the positive trend trading patterns from Q2 continue through the beginning of Q3 to date. While there is some level of uncertainty for the back half of the year, given the expected upcoming changes to The U. S. De minimis exemption later in the month, we anticipate it will not have a major impact on our trading volumes.

This is based on the trading patterns we have seen in the last few months during tariff changes, the limited impact of the suspension of the de minimis exception for products with country of origin China and Hong Kong that already took place this May, and our 3B2C mitigation, which is available for merchants trading large volumes into The U. S. In terms of our business growth, during Q2, we continue to see strong growth across many geographies and cohorts of merchants. As always, our growth was underpinned by our focus on bringing strategic solutions to an increasingly complex and fast changing global e commerce environment.

: Serving as a recent example, globally merchants trading to and from The U. S. Enjoying valuable peace of mind.

Amir Sallakat, Co-Founder and Chief Executive Officer, Global E: They know that irrespective of how frequently tariffs and trade limitations are updated, globally not only makes sure they remain 100% up to date and compliant, but also helps them to navigate complex business decisions, lowering as much as possible the impact of these tariff changes on their sales. Moreover, in the face of higher tariffs, either due to the upcoming change to the de minimis exception or other tariffs, our 3B2C solution and the ability to provide duty drawback further increase the attractiveness of our solution. We are seeing these resulting increased interest within our new merchant pipeline and within our conversations with existing brands. Before we move on to our Q2 results and forward guidance in more detail, I would first like to go through a few recent exciting business developments.

: First,

Amir Sallakat, Co-Founder and Chief Executive Officer, Global E: we extended our long term strategic partnership with DHL, entering into an additional three year agreement. This is our second renewal with DHL since our IPO, and our partnership with them remains very strong and fruitful. This new agreement enables us to provide excellent service to merchants and shoppers alike, while creating value for both globally and DHL. Second, as we announced two weeks ago, we acquired ReturnGo, a leading provider of AI enabled return and exchange solutions. This acquisition is designed to elevate our native post purchase solutions for our merchants.

In parallel to our partnership with industry leaders leading return solutions such as Loop. As we integrate ReturnGo’s advanced technology for automating returns, exchanges and other post purchase flows into our tech stack, we believe this will enable globally merchants to provide more flexible, best in class return experiences to their customers worldwide. ReturnGo is the third acquisition that we have made since our IPO and is an exciting addition to our offering. Third, I wanted to provide an update on our 3B2C offering. As discussed on the last call, we developed this innovative new offering in record time to enable global brands to leverage their international footprint in order to partially offset costs due to rising tariffs.

Given the addition of recent changes to tariffs, and most notably the suspension of the de minimis exception, we have seen growing traction for this offering with interest from both existing and new merchants worldwide. I also wanted to quickly note that we remain on track in terms of updating our managed market solution, working in close collaboration with our partners at Shopify according to our joint plan. Lastly, an update on borderfree.com, our demand generation platform. We continue to onboard new merchants onto borderfree.com in Q2, and now have more than two fifty merchants using this platform. We continue to see encouraging results with an increase in the contribution of sales from merchants utilizing borderfree.com in Q2, reaching over 4% of sales that originated from this channel.

In terms of enterprise sales progress in the quarter, we experienced continued strong demand for our services across different markets, as a large number of brands went live globally during Q2. A few notable examples of brands that launched with us in Q2 are SteelSeries, a gaming consumer technology company and Gani, a well respected fashion brand, both from Denmark Jackie, a fashion brand from The UK known for its beautifully curated affordable collections. And The UK beauty retailer Essential. Stadium Goods, one of the premier global resellers of sneakers and streetwear out of The U. S.

That also has its own in house apparel line. Bandai Namco, a Japanese gaming and media conglomerate with whom we launched in EMEA in Q2. Nanushka, a fashion brand which is our first merchant based out of Hungary. Almada Labo, a rising star in luxury fashion out of Finland. Skylark, the new fashion brand from Justin and Hailey Bieber, which we launched within one week of engagement.

And lastly, Life360, an exciting consumer tech merchant and our first subscription brand. We also expanded with a number of current merchants entering into new geographies. For example, with Veolia, we added multiple countries in Europe, as well as Australia and Japan. We launched in Hong Kong with Bang and Olufsen, Onitsuka Tiger and Diesel. We added Central And Eastern Europe for Jones Road Beauty, the fast growing makeup brand and Bennett Winch, the luxury luggage brand used our services to enter into Taiwan.

With the traction we are seeing in the business and the pipeline, the launch of new brands and expansions with existing ones across our various geographies, we believe we are well positioned to continue on our path towards our long term targets of continued durable and profitable growth well into the future. I will now hand it over to Ofer to take us through the quarterly numbers in more depth, as well as our increased 2025 guidance and Q3 outlook.

Ofer Korin, Chief Financial Officer, Global E: Thank you, Amir, and thanks everyone for joining us today for our earnings call. As Amir mentioned, Q2 was another strong quarter for globally. We continue to deliver results well above the rule of 40, driven by the growth of volumes processed through our platform and healthy margins. Before I go into the details of the quarter, I’d like to remind everyone 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 release issued today.

GMV in Q2 was $1,454,000,000 up 34% year over year, 3.3% above the midpoint of our range for Q2. Despite the continuous high level of uncertainty, mainly due to the tariff dynamics, trading volumes remained resilient in the second quarter. We continue to see solid trade volume through the first weeks of Q3, and as Amir discussed, a more complicated environment in this regard tends to lead to increased opportunities for us. In Q2, we generated total revenue of $214,900,000 up 28% year over year, 3.6% above the midpoint of our guidance range. Service fee revenue for the quarter were $102,900,000 and fulfillment services revenue for the quarter were $112,000,000 Service fee take rate increased compared to Q1 twenty twenty five, mainly due to a positive mix, while fulfillment take rate decreased as expected, mainly due to seasonal higher average order value and the partial planned shift of volumes to multi local.

Progressing through the income statement, non GAAP gross profit was $99,900,000 up 34% year over year, representing a gross margin of 46.5% compared to 47.8% in the same period last year. Gross margin has expanded compared to Q1 twenty twenty five due to the higher share of service fee revenue in the mix. GAAP gross profit was $97,700,000 representing a margin of 45.5%. Moving on to operational expenses, we continue to invest in the development of our platform to further enhance our offering and add value to the merchants. R and D expense in Q2,

Conference Operator: excluding stock based compensation was $26,200,000 or 12.2% of revenue compared to $21,200,000 or 12.6% in the same period last year. Total R

Ofer Korin, Chief Financial Officer, Global E: and and D D spend in Q2 was $30,700,000 We’re investing for growth within our sales and marketing spend, while at the same time remaining focused on driving efficiency throughout the organization. As such, sales and marketing expense, excluding Shopify related amortization expenses, stock based compensation and acquisition related intangibles amortization was $27,200,000 or 12.7% of revenue compared to $19,000,000 or 11.3% of revenue in the same period last year. Shopify warrant related amortization expense was $12,900,000 in the quarter, down from $37,400,000 in Q2 twenty twenty four. As a reminder, we expect this expense to continue to decrease for the remainder of the year and to be completely gone at the 2026. Total sales and marketing expenses for the quarter were $44,000,000 down from over $60,000,000 last year.

General and administrative expenses excluding stock based compensation were $8,800,000 or 4.1% of revenue compared to $9,400,000 or 5.6% of revenue in Q2 of last year. The year on year decline was primarily due to one off costs recorded in Q2 of the previous year as well as improved operational efficiencies. Total G and A spend in the quarter was $12,500,000 Adjusted EBITDA was 38,500,000 up 23% from Q2 twenty twenty four and four point one percent above the midpoint of our guidance range. Adjusted EBITDA margin was 17.9% versus an 18.7% margin in Q2 twenty twenty four, impacted by the lower gross margin. In Q2, we turned GAAP profitable.

The net profit in the quarter was $10,500,000 compared to a net loss of $22,400,000 in the year ago period. The net profit was driven mainly by the reduced amortization expenses related to the Shopify warrant as well as from the growth of the business. As Amir mentioned, given the amortization of the majority of the Shopify warrants related asset is now done with the rest expected to be fully amortized by early twenty twenty six, we expect to be GAAP profitable moving forward and for the full year of 2025. Moving on to the balance sheet and cash flow statements, we ended the quarter with $516,000,000 in cash and cash equivalents, including short term deposits and marketable securities. Q2 was a strong quarter of cash generation with free cash flow of $63,500,000 in the quarter.

Now let’s go through the Q3 and updated full year guidance. For Q3 twenty twenty five, we’re expecting GMV to be in the range of $1,455,000,000 to $1,495,000,000 At the midpoint of the range, this represents a growth rate of 30% versus 2024. We expect Q3 revenue to be in the range of $214,000,000 to $221,000,000 representing a year over year growth rate of 24 at the midpoint. For adjusted EBITDA, we are expecting a profit in the range of 37,500,000.0 to $41,500,000 or a margin of 18.2% in the midpoint. For the full year of 2025, we anticipate GMV to be in the range of $6,220,000,000 to $6,520,000,000 representing a 31% annual growth rate at the midpoint of the range.

Revenue is expected to be in the range of 9 and $21,500,000 to $971,500,000 representing a growth rate of 26% at the midpoint of the range. For adjusted EBITDA, we’re expecting a profit of 180,000,000 to $200,000,000 As Amir mentioned, we are very excited about the acquisition of ReturnGo, which we believe will enable us to elevate our post purchase solutions experience and functionality. We expect the deal to have slight positive contribution to revenue and a limited negative impact on adjusted EBITDA in 2025. However, we expect the impact on profit to be close to neutral by 2026 once we are able to realize all the planned cost synergies. To summarize, as the results we present to you today reflect, we remain on track on our growth trajectory as per our long term targets.

We believe the current environment represents exciting opportunities for globally to add value and continue growing. Given the increasingly complicated global e commerce environment, our services are becoming more integral to merchants every day. 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. And with that, Amir, Nir, Alan and I are happy to answer questions you may have. Operator?

Conference Operator: Thank With that, our first question comes from the line of Will Nancy with Goldman Sachs. Please go ahead.

Will Nancy, Analyst, Goldman Sachs: Hey, guys. Appreciate you taking the questions this morning. I wanted to maybe ask about a couple of your comments around the de minimis exemption and your expectations around that in the back half of the year. I take from the comments that you guys are not expecting a significant impact. So maybe if you could just talk a little bit about some of the ins and outs of your expectations in the back half of the year.

And I guess I’ll just ask, like, you seeing the removal of the de minimis and the continued trade uncertainty? Has that driven any upside to the back half of the year? And is that maybe offsetting any kind of headwinds associated with some of the changes?

Amir Sallakat, Co-Founder and Chief Executive Officer, Global E: Yes. I wouldn’t I don’t know. Hi, first of all, it’s Amir. Thank you for the question. I’m not sure I would consider it as a tailwind, but definitely as we commented, the trading looks resilient.

We’re already past few months of trading post the recent changes to the de minimis exemption. As we said, we haven’t seen any material impact. The same store sales are within the multiyear trend. Yes, there is still some uncertainty. We are faced and our merchants are faced with ever changing landscape and we do believe that at the August, the change that is coming will happen, exemption, but we took all of that into consideration when we provided the guidance.

So despite all of that uncertainty, we did see trade deals coming in, so we believe that generally speaking, the risk of more tariffs or reciprocal tariffs has been reduced. And it’s also it’s important to remember that when you look at the inbound volumes that we have into The U. S, which is about 12% of the trade, about third of that is coming from country of origin, China and Hong Kong. So the remainder will have some impact on when the de minimis is removed for the rest of the country. But again, we don’t expect we do expect to see an offset of that in terms of the pricing of the product.

And overall, we don’t expect a meaningful impact on our trade volumes.

Will Nancy, Analyst, Goldman Sachs: Got it, super helpful. And maybe just a housekeeping item here on the acquisition, is there any way you could lay out what the expectation of what’s assumed in the back half of the year guide on the top line? And then similarly, on the OpEx side, I think you mentioned investing in sales and marketing this quarter. Should we take that as sort of your direct sales force? Or is that continued strength in Shopify?

And just how you’re thinking about OpEx trends and sales and marketing in the back half? Thanks.

Ofer Korin, Chief Financial Officer, Global E: Sure. So in terms of return goal for 2025, it will have a slight positive impact to revenue of just over $1,000,000 In terms of adjusted EBITDA, it will be slightly dilutive. We expect it to have a negative impact of approximately $1,000,000 on the adjusted EBITDA. By the way, 2026, once we achieve the expected synergies, which should be relatively simple to achieve, it should be very close to EBITDA neutral. In terms of sales and marketing, we have seen a certain increase of sales marketing out of as a percentage of revenue.

Some of it is attributed to the higher volumes of GMV and the rev share we paid to Shopify, which is expected to reduce in the last few months of the year. And the remaining, yes, is a certain additional investment that we will put in or already putting into sales and marketing a few more people.

Will Nancy, Analyst, Goldman Sachs: That’s very helpful. I appreciate you taking the questions.

Amir Sallakat, Co-Founder and Chief Executive Officer, Global E: Thanks Will.

Conference Operator: Your next question comes from the line of Samad Samana with Jefferies. Please go ahead.

Samad Samana, Analyst, Jefferies: Hey, good morning and good to see the strong quarter. Maybe first just the three B2C product, you guys mentioned that there’s good uptake there and especially kind of given the policy environment. How now that you’ve had customers adopt it and go live with it and utilize it, what type of take rate are you seeing from that cohort of customers? And how should we think about maybe the impact to the take rate going forward as you see more adoption of 3B2C? And then I have one follow-up question.

Nir Debbie, Co-Founder and President, Global E: Hi, Samad, it’s Neil. So first, we are very excited with the 3B2C solution. We are seeing growing interest from both new and existing merchants, especially with the abolishment of the minimus expected to come in August. We have a couple of merchants already live and trading with the solutions and we have others that are expected to launch within the quarter and a few new ones already in the funnel. In terms of the take rate dynamics, it’s kind of close to the regular dynamics that we see on a regular B2C transaction, because our fees are calculated out of the consumer transaction, which is actually the same between a pre B2C model and our regular model.

There might be a minimal impact in terms of the clearance fees, but this is, I would say, miscellaneous in terms of our take rates.

Samad Samana, Analyst, Jefferies: Great. And then maybe on the acquisition, I’m curious if that was a company that you were already partnering with. And if I look at ReturnGo’s website, there’s some pretty notable logos that they have that globally may not have. So are you is there an opportunity to maybe go and cross sell or acquire their customers? And what’s maybe the overlap in your base today?

And how much of a cross sell opportunity is there? Just maybe more details on what the opportunity there is given that it’s relatively small in size.

Nir Debbie, Co-Founder and President, Global E: Sure. Thank you. It’s Nir again. So first, we believe that this acquisition will further position us with a best in class solution in the market for post purchase. Today, we mainly our solution was built on our internal capabilities that weren’t best in class, and now we have, I would say, an in house solution that will be best in class for our merchants with additional services built into it, such as exchanges and more.

More than that, yes, they do have within the client base certain level of client that can be a relevant fit to become a Global merchants that aren’t currently our merchant. And in the as part of the synergies we are looking to have, we would also of course offer these merchants to utilize the rest of Global e services. Yet to be proven what would be the success rate on that, but this was an add on to the rationale. The main rationale, just to be clear, was to improve the post service solution and increase the shopper satisfaction for all our brands.

Samad Samana, Analyst, Jefferies: Great. Thanks again, gents. Again, gents. Have a great day.

Amir Sallakat, Co-Founder and Chief Executive Officer, Global E: Thank you. Thanks, Simon.

Conference Operator: Your next question comes from the line of James Faucette with Morgan Stanley. Please go ahead.

James Faucette, Analyst, Morgan Stanley: Hey, good morning. Thanks for the time this morning. Wanted to chat on a couple of things or ask a couple of questions. First on the back half of the year, there’s pretty good implied acceleration there. It’d be great if you could provide some insight into the growth and composition of the pipeline as you see it today.

And if there’s been any change since Liberation Day? And in particular, do you still expect to grow net new merchant GMV on a dollar basis this year, even though you had such a strong benefit from enterprise adds last year?

Ofer Korin, Chief Financial Officer, Global E: Jane, thank you for the question. It’s Ofer. I think that regarding the back half of the year, generally speaking, as we’ve mentioned, we see very solid trading patterns. We see solid same store sales numbers and we see that continuing into July and the August. So this is definitely a positive.

But also on top of that, we have been adding merchants throughout the year. We don’t have this year, the two very large ones. But when you look at the overall numbers, they are very similar to what we have seen last year, just much less concentrated. So we will continue onboarding merchants until peak period. And we expect in terms of GMV from new merchants, we expect to see similar contribution to last year.

Pretty similar numbers. Hopefully, if it goes well, might be even above those numbers.

James Faucette, Analyst, Morgan Stanley: Got it, got it. And then I know you already touched on take rate, but obviously good to see the recovery and the sequential improvement in service fee take rate. How should we think about the drivers of take rate on a go forward basis? And I’m just wondering how to think about that on the services side as well as what kind of trajectory we should be expecting on fulfillment, especially with multi local adoption and trying to think about that on a more medium term basis? Thanks.

Ofer Korin, Chief Financial Officer, Global E: Yes. So in terms of service fee take rates, as we’ve mentioned, when we guided for the year after the certain drop we had as a result of the loss of Ted Baker, we expected it to be more or less stable. There is some volatility between quarters due mainly due to mix. But our expectations still remain the same, so we expect it to be close to H1 levels. Q2 was a very good quarter in that sense.

But again, we had the positive mix contributing. We do see more interest, and we are also gradually building more propositions around value added services, mainly duty drawback. And we expect that going into next year, this might contribute still early to say, but we see due to the changes in tariffs in the tariff environment, we do see an opportunity there. So that might potentially provide us an upside opportunity, but it’s a bit early to say if that will come through.

James Faucette, Analyst, Morgan Stanley: That’s great. Thanks for that.

Ofer Korin, Chief Financial Officer, Global E: Just in terms of the fulfillment take rate, we expect them to remain for the remaining of the year to be again close to Q2 levels because on the one hand, we will see higher share of multi local. As we commented in the beginning of the year, there are two or three large merchants that are shifting some of their volumes to multi local, we will see this some of it has already happened, and some will happen in the remaining of the year. On the other hand, Q2 has some AOV seasonality, typically a high AOV quarter average order value, and this has been the case also in this Q2, so we expect that to have a positive impact that will offset the multi local impact for the remaining of the year. So, we expect it to stay close to the current levels.

James Faucette, Analyst, Morgan Stanley: Great. Appreciate that, Ofer. Have a good day, everybody.

Samad Samana, Analyst, Jefferies: Thank

Conference Operator: next question comes from the line of Chris Zhang with UBS. Please go ahead.

Chris Zhang, Analyst, UBS: Hi. Thanks for taking my question. So I wanted to ask about the new arrangement with Shopify and mainly related to the 3P side. So first on the wrap share reduction, maybe can you confirm the timing of the wrap share reduction on the 3P side and how you have baked that into the EBITDA guide? Because it seems that from the implied Q4 EBITDA margin, it shows a slightly higher than typical sequential step up.

And how much of that is reflecting the new agreement? And then I’ll follow-up on the pricing.

Ofer Korin, Chief Financial Officer, Global E: Hi, Chris. Thank you for the question. It’s Ofer. In terms of the timing, it will come in late in Q3. So there will be a limited impact in Q3, and the new arrangement will be in place, obviously, for Q4.

We definitely took that into account in our guidance. As we’ve mentioned, I think, the previous quarter, over time, we expect sort of the new situation to have to weigh a bit on our gross margin as we do expect to see some more competition. Although for now, I would say, we haven’t seen a significant change in the environment. However, the reduction in the rev share will enable us over time we believe that it will enable us over time to get overall improved economics and improve our adjusted EBITDA.

Chris Zhang, Analyst, UBS: Thank you so much for the color. And I think you pretty much answered the question on the prices. So maybe I’ll just ask more about specific products. And just from your new agreement, there’s a mention of Shop Pay to be made available on the 3P side. And maybe can you talk about your thoughts on the impact on the payments portion of the revenue in 3P?

And if there’s any potential for Shopify payments in general to take over a bigger responsibility on the 3P side considering the variable parts, including rate conversion of Shopify payments, but also some of the potential economic changes there. Just wanted to hear your thoughts.

Nir Debbie, Co-Founder and President, Global E: Great. Thank you. It’s Neil. So just on the market dynamics, as we expected, we have seen some increase in the competitive landscape. However, if you take into account our high win rate on other platforms, as well as our vast experience on the Shopify platform and the preferred status that we have with exclusive features and capabilities, we believe that we will have even more than that on the Shopify platform.

So on the competitive side, we feel quite strong with the recent changes. In terms of Shop Pay, we are expecting it to be launched sometime late Q3, early Q4, and we expect it will be heavily used and adopted by our merchants as it is used on Shopify. In terms of utilizing the Shopify payments for our services for 1P, of course, it’s going to be embedded in the new model of Shopify within the managed markets. For 3P, it’s not planned.

Chris Zhang, Analyst, UBS: All right. Thank you very much for the details. Appreciate it.

Amir Sallakat, Co-Founder and Chief Executive Officer, Global E: Thanks, Chris.

Conference Operator: Your next question comes from the line of Scott Berg with Needham. Please go ahead.

: Hi, everyone. Really nice quarter. Two questions for me. I wanted to start with some detail on the new Life360. I guess, deal and contract consumer tech is not necessarily new for you all, but subscription based product seems, I don’t know, a little strange to me because there’s no cross border shipping really within to it.

There’s no shipping charges necessarily, but how does that opportunity kind of fit into, you know, the broader globally portfolio here going forward?

Nir Debbie, Co-Founder and President, Global E: Scott, it’s Neil. Thank you for the question. We started this journey when we targeted the consumer electronics. And once we started to gain traction in the vertical and we have today multiple clients within the vertical, even I think Camille spoke about SteelSeries, very nice consumer electronics brands that just launched with us. We came into an evolution that also subscription was needed.

We don’t see a straightforward play for digital goods subscription, a large opportunity for globally. However, we do see it is supporting merchants that are selling physical goods and want a subscription on top of it, whether it’s plans to use as extra plans to sell on top of their physical goods or a standalone product that is a digital subscription good, but for a merchant that sells also physical goods. So we believe this would be our sweet spot. There might be some pure players, but this is not the core for our strategy. And for those merchants that have a combination of physical, virtual and subscription, we are best positioned to take advantage of it because it does require our clearance capabilities, our know how in duty management and physical good movement.

: Very helpful, Nir. Appreciate that. And then from a follow-up perspective, the growth in your U. S. Business has actually accelerated year over year, which is kind of interesting given what’s going on with all the different tariff dynamics there.

Can you help understand what’s maybe specifically going on with The U. S. Side of your business? Maybe it’s just more focus there to drive more vendors from The U. S, but any color there would be helpful.

Thank you.

Nir Debbie, Co-Founder and President, Global E: Sure. Then The U. S. Business continues to outperform. A lot of this outperformance is from very strong growth of some of The U.

S. Brands. Our U. S. Brands, a lot of them are much more digitally native than where we see in other parts of the geo we serve and these clients typically grow faster.

So in average, have a faster same store sales growth, which is actually growing The U. S. Even faster than other parts of the world. In terms of the new booking contribution, U. S.

Isn’t doing better than our other developed markets. And I can say that the emerging markets are growing even faster, but their share in our overall mix is still relatively low.

: Wonderful. Thanks for taking my questions.

Conference Operator: Thank you. And your next question comes from the line of Mark Zukodovich with Benchmark. Please go ahead.

Alan Katz, Investor Relations, Global E0: Thank you. Just on the border free comment.

Amir Sallakat, Co-Founder and Chief Executive Officer, Global E: Can you repeat? We just got cut off.

Alan Katz, Investor Relations, Global E: Can you hear me okay?

Amir Sallakat, Co-Founder and Chief Executive Officer, Global E: Yeah, now we can hear, sorry.

Alan Katz, Investor Relations, Global E0: Okay, sorry about that. I just was hoping you could comment further on the border free 4% revenue contribution and whether that was in line with your expectations or above? And then if we think about the two fifty merchants that you’ve onboarded there, how core are they to driving that contribution level higher? And what would you expect to see in terms of total merchants exiting this year, just roughly just trying to get a sense of the pace of that merchant growth that we should look for? Thanks.

Nir Debbie, Co-Founder and President, Global E: Just to clarify it’s Neil, thank you. Just to clarify the metrics, the 4% growth for those merchants, it’s merchants that actually joins the BorderFree platform. It’s not our entire base of merchants, it’s those that actually adopted the platform for them, BorderFree is equal today to 4% of the business, 4% of the traffic is actually end sales are coming out our demand generation solution on the borderfree.com. We are happy with the development of it. It was the product was launched in Q4 last year.

It’s just early days still early days for the product. When we met you all at the Investor Day, we already seen traction with around 2.6% already coming of the traffic for the participating sites coming from borderfree.com. We’re currently over four. It’s in line with our expectation and over time we expect that with maturity we can hit over five percent and even up to 10% on average with some of the brands or I would say the high contribution brands even enjoying a two digit contribution from our demand generation, which is a great driver for native growth as we take percent of their growth. And of course, increases the stickiness of our model is now we’re not only converting better for you and simplifying your global operation, we’re also driving new revenue.

Alan Katz, Investor Relations, Global E0: That’s helpful. And maybe a separate question just around NDR trends in the first half versus what is implied in your second half revenue guidance. And also if you could perhaps qualify your same store merchant GMV growth relative to new year to date and how that sort of compares to last year? Thank you.

Ofer Korin, Chief Financial Officer, Global E: Generally speaking, there is some volatility between periods, but when we look at the year to date figures, as we mentioned, in line with our historical average and pretty close to the numbers we had in our planning. And this has been also continuing in the beginning of Q3. For the remaining of the year, we expect that to stay more or less in that environment. In terms of contribution from new merchants, as we’ve mentioned previously, we expect that contribution to be pretty close to what we have seen last year. Last year, we had a lot of contribution in the last part of the year from new merchants.

This time, it’s much concentrated both in terms of timing and also the volume contribution of each merchant, but we expect the numbers to be pretty close.

Alan Katz, Investor Relations, Global E0: Excellent. Thanks, guys.

Conference Operator: Thank you. And your next question comes from the line of Patrick Walravens with Citizens. Please go ahead.

Samad Samana, Analyst, Jefferies: Great. Thank you. And and let me add my congratulations. Amir, maybe if you and and probably near too. Just stepping back, if you look at the last five years of your your your relationship with Shopify, what do you think are sort of the key lessons that you’ve learned?

Amir Sallakat, Co-Founder and Chief Executive Officer, Global E: Well, much time do we have?

Alan Katz, Investor Relations, Global E: That’s probably not on

Amir Sallakat, Co-Founder and Chief Executive Officer, Global E: the Q

Nir Debbie, Co-Founder and President, Global E: and A script.

Amir Sallakat, Co-Founder and Chief Executive Officer, Global E: No, actually, think what we’ve learned along the years and I think it’s reflected in the fact that the relationship is continuing to grow, continuing to flourish and we continue to renew our vows every so often is that it has the, I think all the basis for a good mutually beneficial partnership because each side brings to the table its strength and its unique contribution. So I think to me that is the basis of every good long term strategic relationship and we’re seeing the benefits of that both on our enterprise side and as all seen that led to an even deeper relationship on what has now become managed markets and is we’re on that, we’re working ever so closely with Shopify to make it an even deeper and more synergetic integration. So to me, it’s the main lesson is that if it makes sense to both sides, then it can be a very successful mutually beneficial partnership.

Samad Samana, Analyst, Jefferies: Great. And then my follow-up what are you specifically working on now with Shopify in terms of the additional functionality and when do we expect that to come out? What are the top two or three things?

Nir Debbie, Co-Founder and President, Global E: I think we should divide it between the two solutions. On the managed markets front, we are working on as we guided together with Shopify on aligning the domestic experience to the global experience using managed markets, much more of the functionality through the Shopify platform, utilizing Shopify Payments and making, I would say, the entire reconciliation process seamless between the domestic and the global experience. For the 3P solution, I think the main thing coming up soon is Shop Pay, which we believe would be a great tool to continue and upgrade the conversion to our merchant offering them even a better experience on their global partnership with globally on Shopify. Good to mention here that this feature is also exclusive for globally for the next twelve months. So it’s also a good edge versus competition.

As part of it also Shopify has integrated us into the new market solution that allows more flexibility to our merchant utilizing theme customization, SimEditor and other functionalities that is now available with a combination of Global E and Shopify.

Samad Samana, Analyst, Jefferies: Okay. Thank you both.

Amir Sallakat, Co-Founder and Chief Executive Officer, Global E: Thanks, Pat.

Conference Operator: And your next question comes from the line of Brent Racelin with Piper Sandler. Please go ahead.

Alan Katz, Investor Relations, Global E1: Is Hannah Rudolph on for Brent today. Thanks for taking my questions. I didn’t hear much about multi local in the prepared remarks. It sounds like you are seeing some of that volume shift over to multi local, but was there anything else to call out for the quarter? And do you still expect multi local to hit around 15% of GMV this year?

Nir Debbie, Co-Founder and President, Global E: So I think the reason we didn’t give it much emphasize is that we don’t see a change from the dynamic we already highlighted in our guidance for the year and in our Q1 results. So we continue to see gradual shift towards it, in line with what we indicated around the 15% that we expected to hit. So it’s all baked into our guidance. That’s why we gave it less emphasize in our discussion, but the trend continues and we continue to build services in order to support better trading within multi local and make our service and solution more appealing to multi local merchants.

Alan Katz, Investor Relations, Global E1: Got it, makes sense. And then is Return to Go or Return to Go bringing any AI capabilities or functionality that you can apply to other areas of your business?

Nir Debbie, Co-Founder and President, Global E: They have some AI capabilities related to prediction models around the return, the reasoning behind it, the ability to sell to the client instead of a refund alternative solution such as wallet or gift card loyalty points or an exchange. It’s less relevant for outbound experience, but it is an enhancement that I’m sure that our merchants would be happy to utilize once we make it we complete the integration and make it our internal tool.

Alan Katz, Investor Relations, Global E2: Helpful. Thank you.

Conference Operator: And your next question comes from the line of Maddie Streech with KeyBanc Capital Markets. Please go ahead.

Alan Katz, Investor Relations, Global E2: Hey, guys. Thanks for taking my question. My first one was just on kind of the international split. So it seems like The U. K.

Still kind of see some weakness. Is this expected to continue for the rest of 2025? And then I was wondering if you guys could talk about where you’re seeing the greatest strength in rest of world and maybe where you see the most opportunity going into 2026? Thanks.

Nir Debbie, Co-Founder and President, Global E: So related to the weakness seen outbound UK, I think this is coming out of two reasons. One is mix that is driven from seasonality. We have a huge merchant such as Haywoods that are much more, I would say, stronger in the back half of the year, mainly in Q4. And the rest of the year, are lower. So this is a seasonality effect.

The other part is M and S. M and S was is a significant merchant of us within The UK merchant base and they are at least in this quarter in Q2 and going also into Q3, at least for a significant part of it is currently not trading due to the cyber attack. So this contributes to the overall weakness that you do see in The UK. We do expect it to change trend late Q3, but mainly in Q4 once M and S is trading back in full speed, Herod is going into its peak selling, so we do expect The UK to grow again in share. And as we have also the good pipeline coming out of The UK, we do expect it to continue going into 2026.

Alan Katz, Investor Relations, Global E2: Thank you. And yeah, my second part of that question was just, I’m curious about kind of the other geos that you guys don’t necessarily break out for outbound regions, specifically in parts of like Asia, where you’re seeing the greatest inbound interest and kind of where you see the greatest opportunity to further penetrate those markets? Thanks.

Nir Debbie, Co-Founder and President, Global E: Yes. So I think that and I’ll connect it also to also the slight increase in sales and marketing expense. So we do see a lot of potential in APAC. So we have recruited also additional individuals into sales and account management roles within the region. We have seen very nice traction coming out of Korea.

We have seen growth new growth now in funnel coming out of Taiwan, a new region for us. Australia continues to pick up as we assume the market leadership in global commerce out of Australia and Japan continues to work as well. We mentioned Banda in AMCO as it launched with us out of Japan. We are expecting in Q2, we have additional growth with significant Japanese merchants coming also in Q3. So all in all, we continue to see the share of APAC growing within our pipeline and hopefully we will see that within a few years, it will take its share the same as the e commerce share that it has on a global scale within our sales chart.

Alan Katz, Investor Relations, Global E2: Awesome. Thanks, you guys.

Conference Operator: Your next question comes from the line of Brian Peterson with Raymond James. Please go ahead.

Alan Katz, Investor Relations, Global E3: Hi. Thanks for taking the question. This is John Messina on for Brian. On the land sizes and expansion versus expectations, can you maybe help frame for us what you’re seeing from merchants? Noticing any changes in initial land sizes or number of countries that merchants are launching with?

And then also on the expansion motion with legacy merchants, has the pace of new geo expansion been tracking in line with expectations this year? Thanks.

Nir Debbie, Co-Founder and President, Global E: So by far with the new GMV, most of it is new brands and new logos that are actually launching. Some of them are launches that were signed at the back half of last year. Some of them and many of them are launches that are happening now for merchant signed within this year. We do have some land and expand across some of our larger merchants such as Adidas, We launched Hong Kong, Significant Lane and a few others. But in the Pareto, we see more contribution coming out of new logos.

Alan Katz, Investor Relations, Global E3: Okay, thanks. Helpful color there. And then just one quick follow-up, if I may. On the Shopify partnership, we’re ninety days after the extension and changes there. Just curious of what you’re specifically seeing on the funnel side?

I realize you called out some increased competition, but also wanted to ask on the funnel. And then on the second derivative, are you seeing any elongation and maybe launch timing there? Thank you so much.

Nir Debbie, Co-Founder and President, Global E: So as indicated previously, as expected, once Shopify removed the exclusivity of the new model and moved into a preferred model, we have seen some increase in the competitive landscape. However, as we have a robust solution that was built over the last five years, it has unparalleled scale experience working with Shopify, connecting to Shopify through different APIs. Some of them are exclusive APIs to us. We do see our win rates continue to be super high and a very low impact on our pipeline, especially on the enterprise side.

Alan Katz, Investor Relations, Global E3: Thank you so much.

Conference Operator: And our last question comes from the line of Koji Ikeda with Bank of America. Please go ahead.

Amir Sallakat, Co-Founder and Chief Executive Officer, Global E: Hi.

Alan Katz, Investor Relations, Global E4: This is George McGran on for Koji today. Thank you. Thank you guys for taking our question. I wanted to ask, just another one on Shopify progress. You know, I know that you’ve been working on some Shopify managed markets enhancements this year.

How has that been progressing? And how do you anticipate or do you anticipate you will be pushing harder with this partnership for the remainder of this year and into 2026?

Nir Debbie, Co-Founder and President, Global E: Hi, thank you. It’s Neil. We are tracking according to the milestones agreed with Shopify firing on all cylinders towards launching the new solution of managed markets would be much more seamless for the merchants versus the domestic experience. We work very closely with the Shopify product and development team, and so far we believe that we are, as indicated previously, in line to launch, I would say, the new solution within 2026, with the rollout plan that will be decided by Shopify according to the schedule.

Samad Samana, Analyst, Jefferies: Okay, thank you.

Amir Sallakat, Co-Founder and Chief Executive Officer, Global E: Thanks a lot.

Conference Operator: And we have no further questions at this time. I would like to turn it back to the Global E’s CEO and Co Founder, Amir. Please go ahead.

Amir Sallakat, Co-Founder and Chief Executive Officer, Global E: Thank you. On behalf of the entire Global E team, I’d like to thank all of you for joining us today and for your ongoing support. We continue to see tremendous opportunity to add value for our merchants, drive growth and increase free cash flow. As we expand our global offerings by integrating new capabilities such as ReturnGo or by launching homegrown offerings such as our 3B2C solution, we see a long runway for significant innovation and growth globally to support the growing needs of our merchants in an ever more complex waters of global online trade. We look forward to speaking with many of you during the quarter and updating you on our future earnings calls.

Till then, goodbye and take care.

Conference Operator: Thank you presenters and ladies and gentlemen, this concludes today’s Thank you all for joining. You may now disconnect.

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