Global-e Online Ltd. (Nasdaq: GLBE) the global leader ofDirect-To-Consumer cross border eCommerce enablement, today reported financial results for the second quarter of 2022.

“The record results we are publishing today for the second quarter of 2022, together with the updated guidance for the third quarter and full year, illustrate the continued momentum of our business, as evident from top-linegrowth, improved profitability and the strong new bookings pipeline,” said Amir Schlachet, Founder and CEO of Global-e. “We remain focused on executing across all fronts,to tap the massiveglobal direct-to-consumer opportunity.”

Q2 2022 Financial Results

  • GMV1 in the second quarter of 2022 was $534 million, an increase of 64% year over year
  • Revenue in the second quarter of 2022 was $87.3 million, an increase of 52% year over year, of which service fees revenue was $39.3 million and fulfillment services revenue was $48.0 million
  • Non-GAAP gross profit2 in the second quarter of 2022 was $36.5 million, an increase of 77% year over year. GAAP gross profit in the second quarter of 2022 was $34.3 million
  • Non-GAAP gross margin2 in the second quarter of 2022 was 41.8%, an increase of 580 basis points from 36.0% in the second quarter of 2021. GAAP gross margin in the second quarter of 2022 was 39.3%
  • Adjusted EBITDA3 in the second quarter of 2022 was $11.1 million compared to $7.6 million in the second quarter of 2021
  • Net loss in the second quarter of 2022 was $48.8 million

Recent Business Highlights

  • Launched partnership withDisney,one of the world’s most well-known brands, to support their direct-to-consumer efforts, based on ourmulti-local offering
    • Launched several markets in the APAC region, as a first phase
  • Continued launching withnumerous exciting brands across geographies and verticals, with notable examples being:
    • Leading fashion brands Rag & Bone and Zadig&Voltaire, as well as the official tennis merchandize store of Wimbledon, and the luxury watches brand Zenith, expanding our partnership with the LVMH group
    • Several celebrity brands and other fast-growing digitally native brands, such as Justin Bieber’s fashion brand drew house, the highly successful training apparel brand NOBULL, as well as SKKN, another brand by Kim Kardashian, augmenting our successful partnership with SKIMS
    • APAC expansion continues with the launches of Triangl Swimwear out of Hong-Kong, and Ryderwear, our first live Australian merchant, as well as the signing of our first ever Japanese merchant
  • Expanded activity with brands such as adidas and Suunto, which added additional lanes to be operated by Global-e
  • Continued accelerated growth of the US-outbound business, with revenues up 104% year-over-year
  • Penetration efforts into new markets are starting to show initial positive results
    • While still relatively small in share, APAC and the Middle East outbound revenues have grown 213% year-over-year
  • Strategic partnership with Shopify remains on track
    • On the Global-e enterprise offering side, dozens of merchants of different sizes are already live on our new native integration into the Shopify platform
    • Booked our first live orders as part of the alpha trials of the new white-label Merchant of Record solution on Shopify, built upon the Flow Commerce technology
  • Post-merger integration processes are on track with earlier than planned synergies realization in Flow and the Borderfree process progressing

Q3 and Full Year Outlook

Global-e is introducing third quarter guidance and raising previously issued guidance for the fiscal year as follows:

    Q3 2022   FY 2022
    (in millions)
GMV $600 - $614   $2,450 - $2,550
Revenue $99.5 - $102.5   $406 - $426
Adjusted EBITDA (1) $8.5 - $11.5   $41 - $46

Of this, Borderfree is expected to contribute:

  • Q3 2022: GMV of $50-54 million, at a similar take rate to Global-e’s
  • FY 2022: GMV of $125-135 million, at a similar take rate to Global-e’s
  • A slightly negative adjusted EBITDA both in Q3 2022 and in FY 2022

Given the macro environment uncertainty, we will provide investors with updated business trends as they evolve.

1 Gross Merchandise Value (GMV) is a non-GAAP operating metric. See “Non-GAAP Financial Measures and Key Operating Metrics” for additional information regarding this metric.

2 Non-GAAP Gross profit and Non-GAAP gross margin are non-GAAP financial measures. See “Non-GAAP Financial Measures and Key Operating Metrics” for additional information regarding this metric.

3 Adjusted EBITDA is a non-GAAP financial measure. See “Non-GAAP Financial Measures” for additional information regarding this metric, including the reconciliations to Operating Profit (Loss), its most directly comparable GAAP financial measure. The Company is unable to provide a reconciliation of Adjusted EBITDA to Operating Profit (Loss), its most directly comparable GAAP financial measure, on a forward-looking basis without unreasonable effort because items that impact this GAAP financial measure are not within the Company’s control and/or cannot be reasonably predicted. These items may include, but are not limited to, share based compensation expenses. Such information may have a significant, and potentially unpredictable impact on the Company’s future financial results.

Conference Call Information:

Global-e will host a conference call at 8:00 a.m. ET on Tuesday, August 16, 2022.The call will be available, live, to interested parties by dialing:                       

United States/Canada Toll Free: 1-877-704-4453
International Toll: 1-201-389-0920

A live webcast will also be available in the Investor Relations section of Global-e’s website at: https://investors.global-e.com/news-events/events-presentations

Approximately two hours after completion of the live call, an archived version of the webcast will be available on the Investor Relations section of the Company’s web site and will remain available for approximately 30 calendar days.

Non-GAAP Financial Measures

To supplement Global-e’s financial information presented in accordance with generally accepted accounting principles in the United States of America, or GAAP, Global-e considers certain financial measures and key performance metrics that are not prepared in accordance with GAAP including:

  • Non-GAAP gross profit, which Global-e defines as gross profit excluding amortization of acquired intangibles. Non-GAAP gross margin is calculated Non-GAAP gross profit divided by revenues
  • Adjusted EBITDA, which Global-e defines as operating profit (loss) adjusted for stock-based compensation expenses, depreciation and amortization, commercial agreements amortization, amortization of acquired intangibles, merger related contingent consideration and acquisition related expenses. Adjusted EBITDA is frequently used by analysts, investors and other interested parties to evaluate companies in our industry. We believe that Adjusted EBITDA is an appropriate measure of operating performance because it eliminates the impact of expenses that do not relate directly to the performance of the underlying business.

Global-e uses the Non-GAAP measures in conjunction with GAAP measures as part of Global-e’s overall assessment of its performance, including the preparation of Global-e’s annual operating budget and quarterly forecasts, to evaluate the effectiveness of Global-e’s business strategies, and to communicate with Global-e’s board of directors concerning its financial performance. The Non-GAAP measures are used by our management to understand and evaluate our operating performance and trends.

Global-e’s definition of Non-GAAP measures may differ from the definition used by other companies and therefore comparability may be limited. In addition, other companies may not publish these metrics or similar metrics. Furthermore, these metrics have certain limitations in that they do not include the impact of certain expenses that are reflected in our consolidated statement of operations that are necessary to run our business. Thus, Non -GAAP measures should be considered in addition to, not as substitutes for, or in isolation from, measures prepared in accordance with GAAP.

Global-e also uses Gross Merchandise Value (GMV) as a key operating metric. Gross Merchandise Value or GMV is defined as the combined amount we collect from the shopper and the merchant for all components of a given transaction, including products, duties and taxes and shipping.

For more information on the non-GAAP financial measures, please see the reconciliation tables provided below. The accompanying reconciliation tables have more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliations between these financial measures.

Cautionary Note Regarding Forward Looking Statements

Certain statements in this press release may constitute “forward-looking” statements and information, within the meaning 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 Securities Litigation Reform Act of 1995, including statements regarding Global-e’s operations, strategy and Global-e’s projected revenue and other future financial and operational results. These forward-looking statements generally are identified by the words "believe," "project," "expect," "anticipate," "estimate," "intend," "strategy," "future," "opportunity," "plan," "may," "should," "will," "would," "will be," "will continue," "will likely result," and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this announcement, including but not limited to, the ability to retain merchants or the GMV generated by such merchants; the ability to attract new merchants; our expectations regarding our revenue, expenses and operations; anticipated trends and challenges in our business and the markets in which we operate; our ability to compete in our industry; our ability to anticipate merchant needs or develop or acquire new functionality or enhance our existing platform to meet those needs; our ability to manage our growth and manage expansion into additional markets; our ability to establish and protect intellectual property rights; our ability to hire and retain key personnel; our expectations regarding the use of proceeds from our initial public offering; our ability to adapt to emerging or evolving regulatory developments, technological changes, and cybersecurity needs; our anticipated cash needs and our estimates regarding our capital requirements and our needs for additional financing; the impact of the COVID-19 pandemic, including variants, and related vaccination roll out efforts; and the other risks and uncertainties described in Global-e’s Annual Report on Form 20-F for the year ended December 31, 2021, filed with the SEC on March 28, 2022 and other documents filed with or furnished by Global-e from time to time with the SEC. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. These statements reflect management’s current expectations regarding future events and operating performance and speak only as of the date of this press release. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements. Although we believe that 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 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 the statements are made or to reflect the occurrence of unanticipated events.

About Global-E Online Ltd.

Global-e (Nasdaq: GLBE) is the world's leading platform enabling and accelerating global, direct-to-consumer cross-border e-commerce. The chosen partner of hundreds of brands and retailers across the United States, Europe and Asia, Global-e makes selling internationally as simple as selling domestically. The company enables merchants to increase the conversion of international traffic into sales by offering online shoppers in over 200 destinations worldwide a seamless, localized shopping experience. Global-e's end-to-end e-commerce solutions combine best-in-class localization capabilities, big-data best-practice business intelligence models, streamlined international logistics and vast cross-border experience, enabling international shoppers to buy seamlessly online and retailers to sell to, and from, anywhere in the world. Founded in 2013 by Amir Schlachet, Shahar Tamari and Nir Debbi, Global-e operates from eight offices worldwide. For more information, please visit: www.global-e.com

Investor Contact:Erica Mannion or Mike FunariSapphire Investor Relations, LLCIR@global-e.com +1 617-542-6180

Press Contact:Headline MediaGarrett Krivicich Globale@headline.media +1 786-233-7684 

Global-E Online Ltd.         
CONSOLIDATED BALANCE SHEETS         
(In thousands)         
                 
    Period Ended  
    December 31,     June 30,  
    2021     2022  
    (Audited)     (Unaudited)  
Assets                
Current assets:                
Cash and cash equivalents   $ 448,623     $ 232,971  
Short-term deposits     41,985       35,079  
Accounts receivable, net     9,185       9,344  
Prepaid expenses and other current assets     46,568       52,598  
Marketable securities     18,464       16,492  
Funds receivable, including cash in banks     57,635       63,627  
Total current assets     622,460       410,111  
Property and equipment, net     3,269       9,431  
Operating lease right-of-use assets     20,108       20,565  
Long term deposits     2,219       2,288  
Deferred contract acquisition costs, noncurrent     1,314       1,638  
Other assets, noncurrent     213       190  
Commercial agreement asset   196,544       280,861  
Goodwill and other intangible assets     -       366,221  
Total long-term assets     223,667       681,194  
Total assets   $ 846,127     $ 1,091,305  
Liabilities, Convertible Preferred Shares and Shareholders (Deficit) Equity                
Current liabilities:                
Accounts payable   $ 24,064     $ 30,089  
Accrued expenses and other current liabilities     47,358       51,681  
Funds payable to Customers     57,635       63,627  
Short term operating lease liabilities     2,517       3,316  
Total current liabilities     131,574       148,713  
Long-term liabilities:                
Long term operating lease liabilities     18,803       16,932  
Total liabilities   $ 150,377     $ 165,645  
                 
Shareholders’ deficit:                
Share capital and additional paid-in capital     823,550       1,157,398  
Accumulated comprehensive income     (159 )     (1,714 )
Accumulated deficit     (127,641 )     (230,024 )
Total shareholders’ (deficit) equity     695,750       925,660  
Total liabilities, convertible preferred shares and shareholders’ (deficit) equity   $ 846,127     $ 1,091,305  
                 
Global-E Online Ltd.  
CONSOLIDATED STATEMENTS OF OPERATIONS  
(In thousands, except share and per share data)  
                                 
    Three Months Ended     Six Months Ended  
    June 30,     June 30,  
    2021     2022     2021     2022  
             
    (Unaudited)     (Unaudited)  
Revenue   $ 57,287     $ 87,305     $ 103,438     $ 163,628  
Cost of revenue     36,687       52,954       67,471       102,094  
Gross profit     20,600       34,351       35,967       61,534  
                                 
Operating expenses:                                
Research and development     5,739       17,597       11,182       35,284  
Sales and marketing     30,017       50,986       33,117       100,625  
General and administrative     4,337       15,071       7,051       26,611  
Total operating expenses     40,093       83,654       51,350       162,520  
Operating profit (loss)     (19,493 )     (49,303 )     (15,383 )     (100,986 )
Financial expenses, net     2,420       (680 )     8,129       986  
Loss before income taxes     (21,913 )     (48,623 )     (23,512 )     (101,972 )
Income taxes     311       174       461       411  
Net loss attributable to ordinary shareholders   $ (22,224 )   $ (48,797 )   $ (23,973 )   $ (102,383 )
Basic and diluted net loss per share attributable to ordinary shareholders   $ (0.25 )   $ (0.31 )   $ (0.44 )   $ (0.66 )
Basic and diluted weighted average ordinary shares     87,308,647       156,891,201       54,750,595       155,636,936  
                                 
Global-E Online Ltd.                 
CONSOLIDATED STATEMENTS OF CASH FLOWS                 
(In thousands)                 
    Three Months Ended     Six Months Ended  
    June 30,     June 30,  
    2021     2022     2021     2022  
             
    (Unaudited)     (Unaudited)  
Operating activities                                
Net profit (loss)   $ (22,224 )   $ (48,797 )   $ (23,973 )   $ (102,383 )
Adjustments to reconcile net profit (loss) to net cash provided by operating activities:                                
Depreciation and amortization     69       330       131       594  
Share-based compensation expense     1,551       12,843       2,618       20,772  
Commercial agreement asset     25,486       37,433       25,486       74,182  
Amortization of intangible assets     -       6,049       -       12,665  
Long term deposit revaluation     -       (38 )     -       6  
Accounts receivable     (1,530 )     728       (573 )     4,721  
Prepaid expenses and other assets     (7,561 )     (1,334 )     (5,432 )     (4,725 )
Funds receivable     (7,452 )     960       (9,520 )     20,125  
Long-term receivables     957       -       -     -  
Funds payable to customers     6,122       18,175       (3,500 )     3,238  
Operating lease ROU assets     208       657       590       1,455  
Deferred contract acquisition costs     (184 )     (230 )     (374 )     (475 )
Accounts payable     2,857       2,699       (6 )     2,263  
Accrued expenses and other liabilities     7,163       4,501       (4,406 )     (4,543 )
Deferred tax liabilities     8       -       19       -  
Operating lease liabilities     (163 )     (2,128 )     (628 )     (2,985 )
Impairment of marketable securities     -       48       -       62  
Warrants liabilities to preferred shares     1,625       -       5,872       -  
Net cash used in operating activities     6,932       31,896       (13,696 )     24,972  
Investing activities                                
Investment in marketable securities     (508 )     (357 )     (2,154 )     (7,555 )
Proceeds from marketable securities   257       752     257       7,910  
Purchases of short-term investments     (64,360 )     (197 )     (71,913 )     (31,495 )
Purchases of long-term investments     (31 )     -       (49 )     -  
Proceeds from short-term investments     -       35,000       -       38,400  
Purchases of property and equipment     (149 )     (1,900 )     (263 )     (6,584 )
Payments for business combinations, net of cash acquired     -       (1,471 )     -       (217,083 )
Net cash used in investing activities     (64,791 )     31,827       (74,122 )     (216,407 )
Financing activities                                
Exercise of Warrants to ordinary shares     -     15       -     43  
Proceeds from issuance of Ordinary shares in IPO, net of issuance costs   396,983       -     396,983       -  
Proceeds from exercise of share options     20       386       173       488  
Net cash provided by financing activities     397,003       401       397,156       531  
                                 
Net decrease in cash, cash equivalents, and restricted cash     339,144       64,124       309,338       (190,904 )
Cash and cash equivalents and restricted cash—beginning of period     55,227       203,871       85,033       458,899  
Cash and cash equivalents and restricted cash—end of period   $ 394,371     $ 267,995     $ 394,371     $ 267,995  
                                 
Global-E Online Ltd.                                
SELECTED OTHER DATA
(In thousands)
                                                                 
    Three Months Ended     Six Months Ended  
    June 30,     June 30,  
    2021     2022     2021     2022  
             
    (Unaudited)     (Unaudited)  
Key performance metrics            
Gross Merchandise Value     326,231               534,459               592,786               989,752          
Adjusted EBITDA (a)     7,613               11,128               12,852               14,410          
                                                                 
Revenue by Category                                                                
Service fees     21,106       37 %     39,324       45 %     38,202       37 %     71,272       44 %
Fulfillment services     36,181       63 %     47,981       55 %     65,236       63 %     92,356       56 %
Total revenue   $ 57,287       100 %   $ 87,305       100 %   $ 103,438       100 %   $ 163,628       100 %
                                                                 
Revenue by merchant outbound region                                                                
United Kingdom     27,706       48 %     33,963       39 %     49,250       48 %     62,244       38 %
United States     16,638       29 %     33,944       39 %     29,845       29 %     61,865       38 %
European Union     12,433       22 %     17,798       20 %     23,581       23 %     36,852       23 %
Israel     243       0 %     263       0 %     494       0 %     628       0 %
Other   267     0 %     1,337       2 %   268     0 %     2,039       1 %
Total revenue   $ 57,287       100 %   $ 87,305       100 %   $ 103,438       100 %   $ 163,628       100 %
                                                                 
(a)      See reconciliation to adjusted EBITDA table                                                                

 

Global-E Online Ltd.                   
RECONCILIATION TO Non-GAAP GROSS PROFIT                   
(In thousands)                   
                                   
    Three Months Ended     Six Months Ended    
    June 30,     June 30,    
    2021     2022     2021     2022    
   
   
  (Unaudited)
Gross Profit     20,600       34,351       35,967       61,534    
                                   
Amortization of acquired intangibles included in cost of revenue     -       2,198       -       4,874    
Non-GAAP gross profit     20,600       36,549       35,967       66,408    
                                   
                                   
Global-E Online Ltd.                   
RECONCILIATION TO ADJUSTED EBITDA                   
(In thousands)                   
                                   
    Three Months Ended     Six Months Ended    
    June 30,     June 30,    
    2021     2022     2021     2022    
               
    (Unaudited)     (Unaudited)    
Operating profit (loss)     (19,493 )     (49,303 )     (15,383 )     (100,986 )  
(1)    Stock-based compensation:                                  
Cost of revenue     19       52       39       88    
Research and development     222       5,296       444       10,448    
Selling and marketing     223       1,706       444       2,465    
General and administrative     1,087       5,788       1,691       7,771    
Total stock-based compensation     1,551       12,842       2,618       20,772    
                                   
(2)    Depreciation and amortization     69       330       131       594    
                                   
(3) Commercial agreement asset amortization   25,486       37,433     25,486       74,182    
                               
(4) Amortization of acquired intangibles   -       6,049     -       12,665    
                               
(5) Merger related contingent consideration   -       3,026     -       5,985    
                               
(6) Acquisition related costs   -       751     -       1,198    
Adjusted EBITDA     7,613       11,128       12,852       14,410    
                                   
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